Exam 12: Income Taxes

Differences between the carrying amounts of an entity's net assets determined under accounting standards and accrual accounting, and the tax bases of those net assets determined under the Income Tax Assessment Act, are known as:

Omega Limited has an accounting profit before tax of $400 000. All of the following items have been included in the accounting profit: depreciation of plant $70 000 (tax deductible depreciation is $50 000); entertainment expenses $10 000 (non-deductible for tax purposes); Long service leave expense provided $12 000 (no employee took long service leave during the year). The tax rate is 30%. The amount of current tax liability is: