The accounting profit before tax for Woolmers Led for the year ended 30 June 2024 was $2,985,000 and included the following revenue and expense items: Government grant $500 000 Interest expense 62,500 Depreciation expense - Plant 495,000 Depreciation expense - Office equipment 126,000 Insurance expense 210,000 Doubtful debts expense 178,000 50,000 Additional information: 1) Woolmers Ltd received the $500,000 government grant on 1 March 2024. Woolmers Ltd won this grant for supporting indigenous employment and welfare in regional areas. This grant is not taxable (i.e. exempt from tax). 2) The interest expense relates to the loan from a bank, Omega Bank. The loan was taken out on 1 March 2024 and is an interest only loan with the principal due for repayment on 31 August 2029 Interest of $187,500 is payable on 28 February each year. 3) The plant was acquired on 1 July 2020 for $4,280,000. The plant has an expected useful life of 8 years with a residual value of $320,000 and is depreciated using straight-line method for accounting purposes. Tax depreciates this plant at 10% per annum straight line on cost with no residual value. 4) The office equipment was purchased on 1 July 2018 for $900,000 and expected have to a 7-year useful life with $18,000 residual value. The office equipment is depreciated using straight-line method for accounting purposes. Tax depreciates office equipment at 20% per annum straight line on cost (no residual value). 5) The balance of prepaid insurance at 30 June 2023 was $24,000. 6) Total bad debts written off during the year ended 30 June 2024 was $90,500. 7) Tax includes/treats interest expense and insurance expense on a cash basis. Sales revenue and cost of sales are treated on an accrual basis for tax. Bad/doubtful debts are only allowable as deductions when written off. Impairment losses for goodwill are not allowable as deductions for tax purposes. 8 The balances of deferred tax asset and liability at 30 June 2023 were 118,400 and 47,100 respectively. 9) The tax rate is 30%. The extract from the statement of financial position for Stark Ltd as at 30 June 2024 is as follows:The extract from the statement of financial position for Stark Led as at 30 June 2024 is as follows: Assets Cash $852,000 Inventory 2,744,000 Accounts receivable -1,602,000 Allowance for doubtful debts -207,000 Prepaid insurance 40,000 Plant 4,280,000 Accumulated Depreciation - Plant -1,980,000 Office equipment 900,000 Accumulated Depreciation - Office equipment -756,000 Goodwill 236,000 Accumulated impairment loss - Goodwill -50,000 Liabilities Accounts payable $845,000 Accrued interest 62,500 Omega Bank Loan 1,500,000