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B/F Balance

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › B/F Balance

  • This topic has 0 replies, 1 voice, and was last updated 1 year ago by alawi sayed.
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  • Author
    Posts
  • July 7, 2021 at 2:09 pm #627167
    alawi sayed
    Participant
    • Topics: 152
    • Replies: 166
    • ☆☆☆

    Hello Mr Chris,

    For the following question why do we consider the 1st of Jan 20×8 as B/f balance even though it is in the same year ,

    The following information relates to an entity:
    (i) At 1 January 20X8 the carrying amount of non-current assets exceeded their tax written down value
    by $850,000.
    (ii) For the year to 31 December 20X8 the entity claimed depreciation for tax purposes of $500,000 and
    charged depreciation of $450,000 in the financial statements.
    (iii) During the year ended 31 December 20X8 the entity revalued a property. The revaluation surplus was
    $250,000. There are no current plans to sell the property.
    (iv) The tax rate was 30% throughout the year.
    What is the provision for deferred tax required by IAS 12 Income Taxes at 31 December 20X8?
    A $240,000
    B $270,000
    C $315,000
    D $345,000

    Answer:

    135 D

    $345,000

    $’000
    B/f 850
    Year to 31.12.X8 (500 – 450) 50
    Revaluation surplus 250
    1,150
    × 30% 345

    it is confusing to me as I inteded to add all rise in deferred tax ( 15000+ 75000)
    and adding the negative(255000)
    so the total deferred tax is -165000

    because I considered the B/f as a transaction in the same year ,

    Thanks,

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