Simpson Ltd was established on 1 July 2019 with share capital totalling $132,000.

One year later at 30 June 2020 the trial balance of the company was as follows:

Account	Debit	Credit
Cash	24,000
Accounts receivable	37,500
Allowance for doubtful debts		200
Interest receivable	100
Inventory	20,000
Prepaid insurance	300
Machinery (at cost)	79,000
Accumulated depreciation - Machinery		5,900
Vehicles	11,000
Accumulated depreciation - Vehicles		100
Goodwill	45,000
Accumulated impairment loss		300
Investments	25,000
Accounts payable		15,000
Rent payable		6,000
Provision for annual leave		1,800
Provision for services warranties		600
Share capital		132,000
Sales revenue		650,000
Interest revenue		500
Dividend revenue		300
Exempt income		400
Capital profit on sale of land		700
Cost of sales	175,000
Depreciation	6,000
Goodwill impairment loss	300
Salaries & wages	120,000
Annual leave	1,800
Rent	72,000
Insurance	1,200
Entertainment	400
Fines and penalties	100
Fringe benefits tax	200
Warranty expense	600
Doubtful debts	200
Other expenses	194,100
TOTAL	813,800	813,800

Additional information:

1. For tax purposes, depreciation on machinery is $14,000 and for vehicles $300, for the year ended 30 June 2020.
2. Doubtful debts, annual leave and service warranties are expensed in the year ending 30 June 2020 but are not tax deductible for tax purposes until paid.
3. Simpson Ltd has accrued annual leave entitlements of $1,800 in calculating net profit for the year ended 30 June 2020.
4. Service warranty expense is only deductible as a tax deduction when claimed by customers.
5. The company accrues doubtful debts expense as soon as it appears on a customers account as uncollectible. However, the bad debt is not allowable as a tax deduction until all avenues to collect the account have been exhausted.
6. The tax rate is 30% and taxable income is $79,500.

Required:

1. Complete a deferred tax worksheet.
2. Complete the general journal entry to account for income tax.
3. Complete a statement of comprehensive income for the year ended 30 June 2020 (follow format in textbook on page 650 9^th edition, showing one year only).

4.Prepare a balance sheet at 30 June 2020( follow format in textbook on page 181 9^th edition, showing one year only).

5. Discuss whether you think the deferred tax assets and liabilities are assets and liabilities in relation to the definitions contained in the conceptual framework (reference your written work to support your arguments). Maximum 300 words.

Exhibit 16.3 Single statement of profit or loss and other comprehensive income illustrating the classification of expenses by function XYZ LTD Statement of proft or loss and other comprehensive income for the year ended 31 December 2023 2023 2022 (5000) (5000) Revenue 390 000 355 000 Cost of sales (245000) 030 000 Gross profit 145 000 125 000 Other income 20 667 11 300 Distribution costs (9000) 700 Administrave expenses (20 000) 01 000 Other expenses (2100) (1 200 Finance costs (8000) 0500 Share of profits of anos 35 100 30 100 Prohlbefore 161 667 128 000 Income tax experte 140 412) (32000) Profit for the year from continuing operations 121 250 96 000 Loss for the year from discontinued operations (30 500) Profit for the year 121 250 65 500 Other comprehensive income: Items that will not be reclassified to profit or loss: Gains on property revaluation 933 3 367 Investments in equity instruments (24000) 26 667 Remeasurements of defined benefit pension plans (667) 1 333 Share of other comprehensive income of associates 400 (700 Income tax relating to items that will not be reclassified 5934 (667 (17500) 23000 2023 (5000) 2022 (5000) Items that may be reclassified subsequently to profit or loss: Exchange differences on translating foreign operator Cash fow hedges Income tax relating to items that may be redassified 5334 (667) (1 167) 3 500 (14000) 107 250 10 667 (4000) (1 667) 5000 28000 93 500 Other comprehensive income for the year, net of tax Total comprehensive income for the year Profit attributable to Owners of the parent Non controlling interests 97000 24 250 121 250 52 400 13 100 65500 Total comprehensive income tutible to Owners of the parent Non controlling interests 85 800 21 450 107 250 74 800 18 700 93 500 Earnings per share Basic and diluted SOURCE AS 1, 2014 Gudance on improving Tition of Francio Stato 46 cents 30 cents Exhibit 4.3 Illustration of the liquidity approach to statement of financial position disclosurefrom Commonwealth Bank of Australia Annual Report 2019 Balance sheets Ao at 30 June 2010 Note 51 Cash and I Reclaim ce from the frontal As for unghiname Swart 30 Jun 18 w 31,1 6.378 Trading 32.354 20,913 52 30,00 84 Jun 19 3 Jan 18 30 Jun 19 SM MA IM 29.367 1,417 26,912 BON TAM 324N 312 1.171 26.216 32,133 24.311 7385 74.912 73.212 32,240 786.11 70,MS 00ATO 370 120,109 2,570 1.300 3.001 2,12 1,017 7.90 9,000 47 1.670 1.430 1.57 6,604 5,918 16.661 1 TE 975,105 6,181 64 21 11.1 Other Der mencurities Mamontoad on Murderough come income Avalable for sale nesinoris Lan bile down and there Bank acceptances of customers window to controle Property, plant and equipment Ime in Maard Trang tr nh v l Deferred * * Cla Assets hold for sale Toll most Lies Deposits and other pubborrowings Payah dan to other inancial initions Les ut fra ogromne en Darts Due to controlled arties Current Other provision Imurance pobyt Dabwe Blis payath and other 77,731 SO 370 116,282 1,400 1.118 4,48 1,630 6212 10 DIO, 2.5 4.1 632,234 696.040 23.370 120 22.777 4.2 6.3 10,247 28,472 SPO 572,061 22.010 1.901 26,464 506,200 20,014 100 30,071 379 105,327 320 106,774 120 7.1 1,561 131,062 0.040 130,014 10,140 11.3 103.990 10.206 18. 13.067 22.01 296,850 90.840 $52 1,60 401 172,284 11,025 14,000 804.13 22,2 907,300 B2.0 070460 22. 992,027 66,124 804,313 22,20 106,612 300 Total abilities Net 3.00 1076 GOD Shareholders' Equity Codiny wiecachai 31.030 37,270 38,212 37,33 Reserved 8.3 3.813 2,500 Rutanud pro 8.3 26.462 21, SO 23,000 23,810 Shareholdere Eguilty attributable to quity holders of the Bank 40.5M 46.134 Non-controlling 14 Total Shareholders' Equity 60,640 67,00 46,124 0,00 Odred on this way w you take me ty Iwo CPEAK IT OWL Ortodo T Fonte One yer alarme son of a crerur AAS 2016. B AASOS und AASIAN Trondheiter in The cow Balance Sheels should be read in concion wth the companying notes SOURCE OCBA Commonwealth Bank of Austria Reproduced with permission Exhibit 16.3 Single statement of profit or loss and other comprehensive income illustrating the classification of expenses by function XYZ LTD Statement of proft or loss and other comprehensive income for the year ended 31 December 2023 2023 2022 (5000) (5000) Revenue 390 000 355 000 Cost of sales (245000) 030 000 Gross profit 145 000 125 000 Other income 20 667 11 300 Distribution costs (9000) 700 Administrave expenses (20 000) 01 000 Other expenses (2100) (1 200 Finance costs (8000) 0500 Share of profits of anos 35 100 30 100 Prohlbefore 161 667 128 000 Income tax experte 140 412) (32000) Profit for the year from continuing operations 121 250 96 000 Loss for the year from discontinued operations (30 500) Profit for the year 121 250 65 500 Other comprehensive income: Items that will not be reclassified to profit or loss: Gains on property revaluation 933 3 367 Investments in equity instruments (24000) 26 667 Remeasurements of defined benefit pension plans (667) 1 333 Share of other comprehensive income of associates 400 (700 Income tax relating to items that will not be reclassified 5934 (667 (17500) 23000 2023 (5000) 2022 (5000) Items that may be reclassified subsequently to profit or loss: Exchange differences on translating foreign operator Cash fow hedges Income tax relating to items that may be redassified 5334 (667) (1 167) 3 500 (14000) 107 250 10 667 (4000) (1 667) 5000 28000 93 500 Other comprehensive income for the year, net of tax Total comprehensive income for the year Profit attributable to Owners of the parent Non controlling interests 97000 24 250 121 250 52 400 13 100 65500 Total comprehensive income tutible to Owners of the parent Non controlling interests 85 800 21 450 107 250 74 800 18 700 93 500 Earnings per share Basic and diluted SOURCE AS 1, 2014 Gudance on improving Tition of Francio Stato 46 cents 30 cents Exhibit 4.3 Illustration of the liquidity approach to statement of financial position disclosurefrom Commonwealth Bank of Australia Annual Report 2019 Balance sheets Ao at 30 June 2010 Note 51 Cash and I Reclaim ce from the frontal As for unghiname Swart 30 Jun 18 w 31,1 6.378 Trading 32.354 20,913 52 30,00 84 Jun 19 3 Jan 18 30 Jun 19 SM MA IM 29.367 1,417 26,912 BON TAM 324N 312 1.171 26.216 32,133 24.311 7385 74.912 73.212 32,240 786.11 70,MS 00ATO 370 120,109 2,570 1.300 3.001 2,12 1,017 7.90 9,000 47 1.670 1.430 1.57 6,604 5,918 16.661 1 TE 975,105 6,181 64 21 11.1 Other Der mencurities Mamontoad on Murderough come income Avalable for sale nesinoris Lan bile down and there Bank acceptances of customers window to controle Property, plant and equipment Ime in Maard Trang tr nh v l Deferred * * Cla Assets hold for sale Toll most Lies Deposits and other pubborrowings Payah dan to other inancial initions Les ut fra ogromne en Darts Due to controlled arties Current Other provision Imurance pobyt Dabwe Blis payath and other 77,731 SO 370 116,282 1,400 1.118 4,48 1,630 6212 10 DIO, 2.5 4.1 632,234 696.040 23.370 120 22.777 4.2 6.3 10,247 28,472 SPO 572,061 22.010 1.901 26,464 506,200 20,014 100 30,071 379 105,327 320 106,774 120 7.1 1,561 131,062 0.040 130,014 10,140 11.3 103.990 10.206 18. 13.067 22.01 296,850 90.840 $52 1,60 401 172,284 11,025 14,000 804.13 22,2 907,300 B2.0 070460 22. 992,027 66,124 804,313 22,20 106,612 300 Total abilities Net 3.00 1076 GOD Shareholders' Equity Codiny wiecachai 31.030 37,270 38,212 37,33 Reserved 8.3 3.813 2,500 Rutanud pro 8.3 26.462 21, SO 23,000 23,810 Shareholdere Eguilty attributable to quity holders of the Bank 40.5M 46.134 Non-controlling 14 Total Shareholders' Equity 60,640 67,00 46,124 0,00 Odred on this way w you take me ty Iwo CPEAK IT OWL Ortodo T Fonte One yer alarme son of a crerur AAS 2016. B AASOS und AASIAN Trondheiter in The cow Balance Sheels should be read in concion wth the companying notes SOURCE OCBA Commonwealth Bank of Austria Reproduced with permission