Reference no: EM132293203

Assignment - Accounting for Income Tax

Learning Outcome

ULO 1: Explain, discuss and integrate the technical and theoretical knowledge about the regulatory environment relating to Australian corporate accounting and reporting; and apply the relevant concepts to "real" situations.

ULO 2: Identify, discuss, evaluate and apply the relevant accounting standards relating to definition, recognition, measurement and disclosure requirements of a reporting entity's assets, liabilities, equity, income and expenses.

ULO 4: Apply and demonstrate the appropriate technical knowledge in analysing company accounting information and problem solving; provide justification for their decisions by making references to relevant accounting standards; and communicate them to relevant stakeholders.

Graduate Learning Outcome (GLO)
GLO1: Discipline-specific knowledge and capabilities GLO2: Communication
GLO6: Self-management GLO8: Global citizenship
GLO1: Discipline-specific knowledge and capabilities GLO2: Communication GLO8: Global citizenship
GLO1: Discipline-specific knowledge and capabilities GLO2: Communication
GLO6: Self-management GLO8: Global citizenship

Accounting for Income Tax

This assignment relates to Topics 4 and 5 on Accounting for Income Tax and requires the following to be submitted:

An excel workbook with the following four (4) sheets:
• Sheet 1: Background Information
• Sheet 2: Calculating Taxable Income
• Sheet 3: Calculating DTA_DTL 2019
• Sheet 4: Change in Tax Rate

Required:

a) Using Sheet 2 ("Calculating Taxable Income"), calculate the taxable income/tax loss and the current tax liability (if any) for the financial year ended 30th June 2019. Prepare a journal entry to recognise the current tax liability/tax loss.

b) Using Sheet 3 ("Calculating DTA_DTL 2019"), calculate the Deferred Tax Asset and Deferred Tax Liability balances as at 30th June 2019. Prepare the deferred tax journal entry for the year ended 30th June 2019. Note that you are NOT required to prepare a journal entry to offset the Deferred Tax Asset and Deferred Tax Liability balances.

c) Assume that by 1 December 2019 there was a change in tax rate from 30% to 27.5%.

Using Sheet 4 ("Change in Tax Rate") briefly discuss the accounting treatment under accounting standard AASB112 "Income Taxes" for the Deferred Tax Asset and Deferred Tax Liability balances as at 1 December 2019 given that the company may now be in a lower tax threshold for the 2019-2020 financial year (maximum 100 words in the space provided). Should you believe an accounting change is necessary, prepare the journal entry to record the effect of the change in tax rate.

Attachment:- Financial Accounting.rar