Question
The following information was extracted from the financial records of Slinky Ltd: machinery purchased on 1 January 2021 for $100,000 (accounting depreciation 20% straight line;
The following information was extracted from the financial records of Slinky Ltd: machinery purchased on 1 January 2021 for $100,000 (accounting depreciation 20% straight line; tax depreciation 10% straight line). If the company tax rate is 30%, the deferred tax item that will be recorded by Slinky Ltd at 30 June 2021 is:
Select one:
a.
CR Deferred tax liability $1,500
b.
CR Deferred tax liability $3,000
c.
DR Deferred tax asset $3,000
d.
DR Deferred tax asset $1,500
After applying AASB112 Income Taxes, Jody Ltd disclosed the following: Income tax expense (Current) $20,500 (Dr) and Income tax expense (Deferred) $5,300 (Cr).
Jody Ltd had a profit before tax of $75,000. The company income tax rate is 30%.
The total for income tax expense that should be disclosed on the Statement of Profit or Loss and Other Comprehensive Income is:
Select one:
a.
$4,560 (Dr)
b.
$15,200 (Dr)
c.
$25,800 (Dr)
d.
$22,500 (Dr)
On 30 June 2020 Kally Ltd had the following balances: current tax liability of $23,000; deferred tax asset $12,000 (2019: $9,000); deferred tax liability $14,000 (2019: $8,000); and, profit and loss summary $42,000.
Assuming there are no other changes to the deferred tax accounts throughout the year, and the income tax rate is 30%, the total income tax expense that Kally Ltd will report in the Profit or Loss and Other Comprehensive Income Statement for 30 June 2020 is:
Select one:
a.
$12,600
b.
$26,000
c.
$20,000
d.
$23,000
On 30 January 2020 Kurt Ltd received a truck that had been purchased from Cobain Ltd, second hand (ie, used), at a price of $24,000. Kurt Ltd had to pay an additional $3,000 to add parts so that the truck would be ready to safely drive for Kurt Ltd's employees. The truck was transported to Kurt Ltd's worksite at a cost of $1,500.
During delivery of the truck, damage was done to Kurt Ltd's worksite and cost Kurt Ltd $500 to repair. On 1 February 2020 the truck was ready to use. Kurt Ltd estimated that the truck had a residual value of $1,500 and a useful life of 3 years. Kurt Ltd uses the straight-line method to depreciate trucks.
The amount that Kurt Ltd should record for depreciation on 30 June 2020 is:
Select one:
a.
$3,750
b.
$9,000
c.
$4,500
d.
$3,125
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