What is journal entry to recognise the current tax liability

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Question - The accounting profit before tax of Swiftback Limited for the year ended 30 June 2021 is $1,400,000. This amount includes $15,000 of interest revenue. Interest received during the year was $20,000, which is assessable for tax when received.

Included in the deferred tax asset (DTA) balance at 30 June 2021 is an amount of $21,000. This relates to $70,000 in tax losses that may be utilised in the year ended 30 June 2021. The tax losses utilised are treated under the tax law as a tax deduction, thus reducing the taxable income.

The tax rate is 30%. What is the journal entry to recognise the current tax liability for Swiftback for the year ended 30 June 2021, including the utilisation of the tax losses?

Reference no: EM132819513

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