Prepare the complete current tax worksheet

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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.

Reference no: EM133134347

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