Calculate the current tax liability for the year ended

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Question - XYZ Pty Ltd recorded an accounting profit before tax of $750,000 for the year ended 30 June 2020.

Included in the accounting profit were the following items of revenue and expense.

Entertainment expenses (non-deductible) for $40,000

Depreciation expense - Motor vehicle (12.5% p.a., straight-line) for $50,000

Rent revenue for $70,000

Penalties and fines for $9,000

For tax purposes the following applied

Depreciation expense - Motor vehicle (20%)

Rent received for $40,000

Income tax rate (30%)

Required -

A. Use a current tax worksheet to calculate the current tax liability for the year ended 30 June 2020.

B. Prepare the adjusting journal entry.

Reference no: EM132569978

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