Exam 23: Revenue From Contracts With Customers

To the extent that tax payable exists and has NOT yet been paid, a company will recognise:

If a taxation authority amends a company's assessment, the company should:

Generally, when considering the differences between the accounting treatment and the income tax treatment of a particular item the accounting treatment is based on:

Malarky Limited accrued €30 000 for employees' long service leave in the year ended 30 June 2016. This item will not be tax deductible until it is paid in approximately 10 years' time. If the company tax rate is 30%, Malarky Limited must record the following tax effect adjustment at the reporting date:

ABC Limited has an asset with a carrying value of €50 000. The tax base of this asset is €40 000. The tax rate is 30%. As a result, which of the following deferred tax items does Roland Limited have?

In jurisdictions where the impairment of goodwill is not tax deductible, IAS 12 Income Taxes:

A deductible temporary difference is expected to lead to the payment of:

The following information was extracted from the financial records of Pamakari Limited: Equipment purchased on 1 July 2015 for $100 000 (accounting depreciation 10% straight line tax depreciation 20% straight line). If the company tax rate is 30%, the deferred tax item that will be recorded by Pamakari Limited at 30 June 2016 is:

Under IAS 12 Incomes Taxes, deferred tax assets and liabilities are measured at the tax rates that:

Carry-forward tax losses create:

Beta Limited has an accounting profit before tax of €200 000. All of the following items have been included in the accounting profit: depreciation of equipment €30 000 (tax deductible depreciation is €20 000); entertainment expenses €15 000 (non-deductible for tax purposes); Long service leave expense provided €6000 (no employee took long service leave during the year). The tax rate is 30%. The amount of current tax liability is:

Use the information below to answer questions A company commenced business on 1 July 2014. On 30 June 2015, an extract of the statement of financial position prepared for internal purposes, but excluding the effect of income tax, disclosed the following information: Assets Liabilities Cash £40,000 Trade payables £80,000 Inventory 100,000 Long service leave 5,000 Plant 300,000 Accumulated depreciation (30,000) Additional information: 1. The plant was acquired on 1 July 2014. Depreciation for accounting purposes was 10% (straight-line method), while 15% (straight-line) was used for tax purposes. 2. The tax rate is 30%. Using the following worksheet, determine the deferred tax asset and deferred tax liability. Carrying amount Future taxable amount Future deductibl e amount Taxable base Deductible temporary differences temporary differences Assets Cash Inventory Plant Liabilities Trade payables Long-service leave Deferred tax liability Deferred tax asset -The deferred tax liability is:

The tax expense related to profit or loss of the period is required to be presented:

The following information relates to Godfrey Limited for the year ended 30 June 2016: Accounting profit before income tax (after all expenses have been included) $\quad$ $£ 300,000$ Fines and penalties (not tax deductible) $\quad$ 20,000 Depreciation of plant (accounting) $\quad$ 40,000 Depreciation of plant (tax) $\quad$ 100,000 Long-service leave expense (not a tax deduction until the leave is paid) $\quad$ 8,000 Income tax rate $\quad$$30 \%$ On the basis of this information the current tax liability is:

Tax losses can be viewed as providing:

According to IAS 12, current tax for current and prior periods shall, to the extent unpaid, be recognised as a:

Balchin Limited had the following deferred tax balances at reporting date: $\bullet$ Deferred tax assets €12 000 $\bullet$ Deferred tax liabilities €30 000 Effective from the first day of the next financial period, the company rate of income tax was reduced from 40% to 30%. The adjustment to income tax expense to recognise the impact of the tax rate change is:

The tax effect method of accounting for a company's income tax is based on an assumption that:

Unless a company has a legal right of set-off, IAS 12 Income Taxes, requires disclosure of all of the following information for deferred tax in the statement of financial position: I The amount of deferred tax assets recognised II The amount of the deferred tax liabilities recognised III The net amount of the deferred tax assets and liabilities recognised IV The amount of the deferred tax asset relating to tax losses

Use the information below to answer questions A company commenced business on 1 July 2014. On 30 June 2015, an extract of the statement of financial position prepared for internal purposes, but excluding the effect of income tax, disclosed the following information: Assets Liabilities Cash £40,000 Trade payables £80,000 Inventory 100,000 Long service leave 5,000 Plant 300,000 Accumulated depreciation (30,000) Additional information: 1. The plant was acquired on 1 July 2014. Depreciation for accounting purposes was 10% (straight-line method), while 15% (straight-line) was used for tax purposes. 2. The tax rate is 30%. Using the following worksheet, determine the deferred tax asset and deferred tax liability. Carrying amount Future taxable amount Future deductibl e amount Taxable base Deductible temporary differences temporary differences Assets Cash Inventory Plant Liabilities Trade payables Long-service leave Deferred tax liability Deferred tax asset -The deferred tax asset is: