Reference no: EM132919726

Polo  Ltd has prepared financial statements and notes to the financial statements for the year ended 30 June 2021. Income tax expense reported in the Statement of Profit or Loss and Other Comprehensive Income for the period 30 June 2021 is $182 000.

The following balances are reported in the Statement of Financial Position:

                                            2021                2020

Deferred Tax Asset     78,000            70,000

Deferred Tax Liability   30,000             34,000

Note to income tax expense

Current Income Tax Expense $194 000

Deferred Income Tax Expense (12 000)

Required:

Problem 1: Using the above information, prepare the end of year adjusting entries that Polo Ltd must have recorded in order to present the income tax expense of $182 000 in the Statement of Profit or Loss and Other Comprehensive Income for the period 30 June 2021.