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Dear Sir,
I can’t seem to understand the answer for Q5 in the back of the notes for mini exercises for topic 8 – taxation.
If the opening balance on Deffered tax is 8400 and need to be reduced to 5600 then the difference should be 2800 (8400-5600)
Dr Def Tax 2800
Cr Current Tax 2800If the Current tax has an opening Debit Bal of 700 and we need it to become a provision of 4500 then the income statement amount should be 2400 (4500+700 opening dbt bal – 2800 transferred from deff tax)
In the back of the notes the answer is
Dr Def Tax 2400
Cr C Tax 2400Dr P/l 2800
Cr C Tax 2800your clarification would be much appricaited.
“In the back of the notes the answer is
Dr Def Tax 2400
Cr C Tax 2400”Not according to my edition of the notes, it isn’t
The answer to exercise 5 in my notes is:
Dr Deferred liability 2,800
Cr Current liability 2,800Dr S of CI 2,400
Cr Current liability 2,400Check your figures for me please and post again if there is an error
OK?
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