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P2-D2.
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ilham9089
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Jasper Orange Co’s trial balance at 31 December 20X3 shows a debit balance of $700,000 on current tax
and a credit balance of $8,400,000 on deferred tax. The directors have estimated the provision for income
tax for the year at $4.5 million and the required deferred tax provision is $5.6 million, $1.2 million of which
relates to a property revaluation.Why do we remove the 1.2 million from the total tax liability for the year?
P2-D2
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The deferred tax on the 1.2 million goes through OCI and not through profit or loss, hence why it is removed.
Thanks
ilham9089
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