Western Sydney Ltd commenced operations on 1 July 2018. The following has been extracted from their internal reports for the second year of operations: (Note: data for the first year of operations is available from Week 3 Lecture Example)Income Statement (Extract) for the year ended 30 June 2020

	$	$
Gross profit ..............................................................................................		756 000
Expenses
Administration expenses .......................................................................	57 000
Doubtful debts expense ……………………………………………………. 20 000
Salaries expense……….........................................................................	195 000
Interest ..................................................................................................	13 000
Long-service leave ................................................................................	28 000
Warranty expense .................................................................................	41 000
Depreciation expense – plant ...............................................................	80 000
Insurance expense ...............................................................................	30 000	464 000
Accounting profit before income tax expense		292 000

Assets and liabilities as disclosed in the balance sheet as at 30 June 2020 were:

Assets
Cash .....................................................................................................	26 000
Inventory ...............................................................................................	105 000
Accounts Receivable (net of $5,000 D. Debt Allowance) .....................	130 000
Prepaid insurance .................................................................................	3 000
Plant – cost ...........................................................................................	400 000
Accum Depn – Plant .............................................................................	160 000 240 000
Liabilities
Accounts Payable ..................................................................................	74 500
Provision for warranty ............................................................................	45 000
Provision for long-service leave .............................................................	2 000
Loan Payable .........................................................................................	175 000

Additional information:

• Plant is depreciated straight-line with no residual value over five years for accounting purposes and four years for taxation purposes.
• The administration expense includes payment of $12,000 for goodwill impairment.
• Bad debts written off during the year were $21,000.
• Insurance, warranty and long-service leave are deductible for tax purposes when paid.
• The tax rate is 30%

Required:

(a) Calculate taxable income and its current tax consequences.

(b) Complete the deferred tax worksheet (use the template attached here:
(ACCT3007 Week 3 Homework Part (b) Template.docx)

(c) Prepare the journal entries for both the current and deferred tax consequences and for disclosure of deferred tax in the Balance Sheet.