Reference no: EM132692311

At 30 June 2017 the statement of Financial Position of Timing Limited included a deferred tax liability amounting to a credit balance R11 152. The deferred tax relates to the only item of equipment owned by the company.

The following information is relevant:

Year ended 30 June

Profit before taxation

2019 - R 282 000
2018 - R 252 000

Wear and tear allowance

2019 - R 40 000
2018 - R 50 000

Depreciation

2019 - R 48 000
2018 - R 48 000

Additional information:

• The tax base of the equipment at 30 June 2017 was R356 120.
• The current normal taxation for the year ended 30 June 2018 is paid on 30 June 2019. No other tax payments were made.
• There were no components of other comprehensive income
• The normal corporate tax rate for Timing Limited is 40%.

Required:

Problem 1: Show the journals relating to taxation depreciation for the years ended 30 June 2018 and 30 June 2019.