As of June 30, 2023, Alpha Ltd disclosed the following details regarding its assets and liabilities from its balance sheet: Assets ($000): Computer equipment at purchase price: 300 Accumulated depreciation: (60) Accounts receivable: 100 Allowance for doubtful accounts: (10) Liabilities: Warranty cost provision: 30 Provision for long service leave benefits: 20 Alpha Ltd depreciates its computer equipment over five years for accounting purposes but over three years for tax purposes, using the straight-line depreciation method. No payments were made for long service leave or warranty claims during the fiscal year. Determine the value of each temporary difference for Alpha Ltd as of June 30, 2023. Calculate the carrying amount and tax base, and specify whether each temporary difference is deductible or taxable.
As of June 30, 2023, Alpha Ltd disclosed the following details regarding its assets and liabilities from its balance sheet: Assets ($000): Computer equipment at purchase price: 300 Accumulated depreciation: (60) Accounts receivable: 100 Allowance for doubtful accounts: (10) Liabilities: Warranty cost provision: 30 Provision for long service leave benefits: 20 Alpha Ltd depreciates its computer equipment over five years for accounting purposes but over three years for tax purposes, using the straight-line depreciation method. No payments were made for long service leave or warranty claims during the fiscal year. Determine the value of each temporary difference for Alpha Ltd as of June 30, 2023. Calculate the carrying amount and tax base, and specify whether each temporary difference is deductible or taxable.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter20: Accounting For Leases
Section: Chapter Questions
Problem 10MC: On August 1, 2019, Kern Company leased a machine to Day Company for a 6-year period requiring...
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![As of June 30, 2023, Alpha Ltd disclosed the following
details regarding its assets and liabilities from its
balance sheet:
Assets ($000):
Computer equipment at purchase price: 300
Accumulated depreciation: (60)
Accounts receivable: 100
Allowance for doubtful accounts: (10)
Liabilities:
Warranty cost provision: 30
Provision for long service leave benefits: 20
Alpha Ltd depreciates its computer equipment over five
years for accounting purposes but over three years for
tax purposes, using the straight-line depreciation
method. No payments were made for long service leave
or warranty claims during the fiscal year.
Determine the value of each temporary difference for
Alpha Ltd as of June 30, 2023. Calculate the carrying
amount and tax base, and specify whether each
temporary difference is deductible or taxable.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F4a69045f-790d-430e-b1ff-044d29c2f779%2Fb73eb0dc-f693-425f-a4c9-042d0712da13%2Fvmd70065_processed.jpeg&w=3840&q=75)
Transcribed Image Text:As of June 30, 2023, Alpha Ltd disclosed the following
details regarding its assets and liabilities from its
balance sheet:
Assets ($000):
Computer equipment at purchase price: 300
Accumulated depreciation: (60)
Accounts receivable: 100
Allowance for doubtful accounts: (10)
Liabilities:
Warranty cost provision: 30
Provision for long service leave benefits: 20
Alpha Ltd depreciates its computer equipment over five
years for accounting purposes but over three years for
tax purposes, using the straight-line depreciation
method. No payments were made for long service leave
or warranty claims during the fiscal year.
Determine the value of each temporary difference for
Alpha Ltd as of June 30, 2023. Calculate the carrying
amount and tax base, and specify whether each
temporary difference is deductible or taxable.
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