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Not certain about the workings. June 2005.
Income tax for year estimated at 260,000. Figure in Income Statement is underprovision. 55,000. The carring value of Harrington’s net assets was 1.400 more than their tax base. Tax rate is 25%. I need to know what figure goes to Income Statement. What figure goes to N.C. L. and what figure goes to C.L.
Thanks for your assistance.
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I think the calculations for income tax expense is as follows:
260,000+55,000+350=315,350(I/S)
SOFP(CL)260,000The tax charge is, from memory, 260 ( per directors’ estimate ) + 55 ( under-provision from last year,) + 70 ( this year’s movement in the deferred tax provision.
Of this amount, 20% x 2m is related to the revaluation of the building and should be debited to the revaluation account. Now, be careful, I may be mixing up my questions here, and I don’t have the question in front of me!
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