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Prepare the complete current tax worksheet

    Assignment Instructions

    Assignment ID: FG133134347

    Question – The financial statements of Glade Ltd for the year ended 30 June 2022 show a profit before tax of $220,500, including the following items of income and expense:

    Fines and penalties 3,200

    Impairment of goodwill 10,500

    Depreciation expense – plant 50,000

    Bad debts expense 5,600

    Warranty expense 9,500

    Insurance expense 6,000

    Rent revenue 12,600

    Additional Information –

    (a) The balance of the Allowance for Doubtful Debts account at 30 June 2021 was $9,800, and at 30 June 2022 the balance in the account was $12,200.

    (b) The balance of the Provision for Warranties account at 30 June 2021 was $12,000, and at 30 June 2022 the balance in the account was $14,500.

    (c) The balance of the Prepaid Insurance account at 30 June 2021 was $5,500, and the balance in the account at 30 June 2022 was $8,000.

    (d) The balance of the Rent Received in Advance account at 30 June 2021 was $16,000, and the balance in the account at 30 June 2022 was $12,500.

    (e) Plant was purchased on 1 July 2021 at a cost of $400,000. Plant is depreciated over eight years for accounting purposes. The depreciation rate for tax purposes for this type of plant is 25%.

    (f) For the year ending 30 June 2021, Spartan Ltd recorded a carry-forward tax loss of $16,000. Spartan Ltd had an expectation of future profits.

    (g) The corporate tax rate is 30%.

    Required – Prepare the complete current tax worksheet, and the applicable current tax journal entries required by Glade Ltd, for the year ended 30 June 2022. Show all workings and calculations.

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