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Calculate temporary differences for taxable profit

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Reference no: EM132519428

Pretax accounting income is USD 25,000

The company registered an revenue of 4,000 in 2008 that is not considered for tax purposes.

A computer server was also bought at the beginning of 2008 for 2,000 € and has a useful life of 2 years. However, according to the tax laws the maximum percentage that is allowed for the deduction of the depreciation expense is a 25%.

Question 1: Calculate temporary differences for 2008, taxable profit and provide journal entries to register income tax for 2008.

Reference no: EM132519428

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