Question
The profit before tax, as reported in the Statement of Profit or Loss and Other Comprehensive Income of Apple Ltd for the year ended 30
The profit before tax, as reported in the Statement of Profit or Loss and Other Comprehensive Income of Apple Ltd for the year ended 30 June 2020, amounted to $65,000 including the following revenue and expense items:
| 30 June 2020 |
| $ |
Rent Expense | 12,000 |
Bad debts expense | 500 |
Depreciation expense - equipment | 10,000 |
Annual Leave Expense | 1,500 |
Interest Expense | 4,500 |
Fines and Penalties (non-deductible) | 2,500 |
Entertainment Expense (non-deductible) | 700 |
Interest on Govt Bonds (exempt from tax) | 2,500 |
Additional information:
- The deduction for depreciation for tax purposes is double the accounting depreciation.
- No bad debts were written off during the year.
- Rent of $15,000 was prepaid at the beginning of the year and is deducted for tax purposes when paid.
- Annual leave paid during the year was $500.
- Interest payments of $4,000 were made in cash.
- The tax rate is 30%.
Required
Prepare the current tax worksheet and the journal entry to recognise current tax at 30 June 2020.
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