The accountant for Lajamanu Production Ltd has the task of preparing the deferred tax

entries in the year-end financial statements at 30th June 2022.

4. Part of the assistance that you have provided to the company was an impairment test undertaken

at the start of the year as the value of the assets had not been reviewed for some time. Equipment

which originally had a carrying amount of $635,000 was revalued upwards to $785,000. The equipment

had an annual accounting depreciation rate of 15% and a tax depreciation rate of 8%.

Required

As the accountant has only recently been recruited you have been asked to complete the preparation of the journal entry adjustments for any temporary tax differences and to explain in each of the situations given above the reasons for the adjustments, why the accounts have been chosen and the timing of the differences and any future reversals.