Solution-What would be the balance of the deferred tax asset

What would be the balance of the deferred tax asset

Assignment Help Accounting Basics

Reference no: EM133150626

Questions -

Q1. Assume that for a particular company the only temporary difference for tax effect accounting purposes relates to the depreciation of a newly acquired machine. The machine is acquired on 1 July 2015 at a cost of $389,000. Its useful life is considered to be 5 years, after which time it is expected to have no residual value. For tax purposes it can be fully written off over 3 years. The tax rate is assumed to be 30 per cent. Determine whether the depreciation of the machine will lead to a deferred tax asset or a deferred tax liability.

Q2. Assume that for a particular company the only temporary difference for tax effect accounting purposes relates to the depreciation of a newly acquired machine. The machine is acquired on 1 July 2015 at a cost of $390,000. Its useful life is considered to be 7 years, after which time it is expected to have no residual value. For tax purposes it can be fully written off over 2 years. The tax rate is assumed to be 30 per cent. What would be the balance of the deferred tax asset or deferred tax liability as at 30 June 2018.

Reference no: EM133150626

Questions Cloud

Supportability analysis tools systematically identifies : Which of the following supportability analysis tools systematically identifies, the possible effects of each failure, and the criticality of each effect on miss

What is the most you can spend on the home : You have $10,000 for a down payment on a house, and can afford a payment of $1,250 per month at 5.1% for 15 years. What is the most you can spend on the home

What are the ten important factors that comprise an awb : What are the ten important factors that comprise an AWB?

Maintain a competitive advantage personally : Reflect on how the concept of competitive advantage has impacted your life. What have you done to maintain a competitive advantage personally and/or professiona

What would be the balance of the deferred tax asset : For tax purposes it can be fully written off over 2 years. The tax rate is assumed to be 30 per cent. What would be the balance of the deferred tax asset

Evaluate perceived effectiveness as a leader : Choose and summarize transformational leadership theory to evaluate your perceived effectiveness as a leader

How can a holistic physical security plan encompass : How can a holistic physical security plan encompass all admin and technical controls needed in a large organisation

If you exaggerate your credentials in an interview : 1. If you exaggerate your credentials in an interview, is it lying? Is lying in order to protect a coworker acceptable?

Describe reporting of preferred stock consistent with ifrs : Consider differences between U.S. GAAP and IFRS with respect to reporting of Preferred Stock. Describe reporting of preferred stock consistent with IFRS

User Account

All Pages

What would be the balance of the deferred tax asset

Reference no: EM133150626

Reference no: EM133150626

Questions Cloud

Reviews

Write a Review

Accounting Basics Questions & Answers

How much control does fed have over this longer real rate

Coures:- fundamental accounting principles

Accounting problems

Theory of interest - term structure of interest rates

Write a report on internal controls

Prepare the bank reconciliation for company

Cost-benefit analysis

Theory of interest

Liquidity and profitability

What is the expected risk premium on the portfolio

Simple interest and compound interest

Capm and venture capital

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT