Tax effects of a temporary difference

The following information was extracted from the records of Waratah Ltd for the year

ended $30$ June $2024$ in relation to a machinery that had cost $$100000$ on $1$ July $2020.$

Carrying

amount

$

Tax base

$

Taxable

temporary

differences

$

Deductible

temporary

differences

$

Assets

Machinery $2500040000015000$

The machinery is depreciated at $25\%$ p$.$a$.$ straight$-$line for accounting purposes, but the

allowable rate for taxation is $20\%$ p$.$a$.$

Required

Calculate the following

$1.$ Accounting expense and tax deduction for each year.

$2.$ Impact of depreciation on the calculation of current tax expense for each year.

$3.$ Effect of the different treatment of depreciation for accounting and tax purposes on

the deferred tax asset account each year.

$($LO$4$ and LO$5)$

Year ended $30$ June $2022$