You have been asked by the management of ABC Ltd to assist with the preparation of the income tax entries for the year ended 30 June 2020. The company reported a profit before tax for the year to 30 June 2020 of $900 000.

Additional information

(a) Interest revenue of $10 000 is included in the profit for the year to 30 June 2020; and the total amount of cash interest received this year is $20 000.

(b) Expenses included in profit for the year to 30 June 2020 are as follows:

depreciation expense for plant $50 000

doubtful debts expense $25 000; the bad debt written-off is $15 000 this year.

warranty expense $36 000; the warranty paid is 50 000 in the current period.

(c) Accumulated depreciation on plant for tax purposes is $300 000 on 30 June 2020 and $150 000 on 30 June 2019. There have been no acquisitions or disposals of plant during the current year.

(d) The corporate tax rate is 30%.