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(iv) The carrying amounts of Wellmay’s net assets at 31 March 2007 are $600,000 higher than their tax base. The rate of taxation is 35%. The income tax charge of $360,000 does not include the adjustment required to the deferred tax provision which should be charged in full to the statement of profit or loss.
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I have understood the differed tax is 210; but why there is not any current tax. I am confused, pls help sir.There is if you read the rest of the question – and what do you think $360,000 is?
sorry sir, i mean current tax b/d to be presented on the SOFP.
this $360,000 is for I/S. After adjustment current tax will increase by $30,000. Now $390,000 will be shown in I/S. But wot about the current tax b/d for the SOFP. This is wot is confusing me.
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