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Assessment 1 - Written Examination

At 30 June 2014, E-Surfboards Limited had the following temporary differences:

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The following information is available for the following year, the year ending 30 June 2015.

E-Surfboards Limited depreciates computers over five years in its accounting records but over three years for tax purposes. The straight-line method is used. During the year E-Surfboards wrote off bad debts amounting to $15 000. Warranty costs of $70 000 were paid during the year. No amounts were paid for long-service leave during the year. The following information is extracted from the statement of financial position at 30 June 2015:

There was no acquisition of plant and equipment during the year.

The tax rate as at 30 June 2014 and 30 June 2015 was 30 per cent.

REQUIRED

(a)	Calculate the amount of each of E-Surfboards' temporary differences, if any, at 30 June 2014, and state whether it is deductible or taxable.
(b)	What is the balance of the deferred tax liability and deferred tax asset, if any, as at 30 June 2014?
(c)	Calculate E-Surfboards' taxable income for the year ended 30 June 2015.
(d)	Prepare journal entries to record current tax and deferred tax for the year ended 30 June 2015 Assessment Mapping Checklist Learner Name/ID: ___________________________________ Performance & Knowledge Evidence C/NYC Comments Performance Evidence · access and accurately compile data and prepare reports for corporate entities that comply with: · relevant accounting standards · statutory and other relevant requirements of reporting bodies. Knowledge Evidence · identify and explain current business taxation requirements · identify and explain current financial legislation and statutory requirements relating to taxable transactions and reporting requirements · explain the key features of integrated computerised accounting systems · describe a range of methods and formats for presenting financial data · outline options, methods and practices for recording and reporting deductions, benefits and depreciation · identify and explain the key principles of double-entry bookkeeping and accrual accounting Comments: Signed by Learner: Date: Signed by Assessor: Date: