Company A is preparing its financial statements as at 31 December 20X3. On 31 December 20X3, Company A acquired an asset for 900, which is expected to be consumed by the end of 20X4. No tax deduction can be obtained for the cost of the asset. The company’s intention is to use the asset and not to sell it. The sale of assets is taxed at 40%. Internal consumption is taxed at 30%. What is the amount of deferred tax liability relating to the acquired asset as at 31 December 20X3?

Company A is preparing its financial statements as at 31 December 20X3. On 31 December 20X3, Company A acquired an asset for 900, which is expected to be consumed by the end of 20X4. No tax deduction can be obtained for the cost of the asset. The company’s intention is to use the asset and not to sell it. The sale of assets is taxed at 40%. Internal consumption is taxed at 30%. What is the amount of deferred tax liability relating to the acquired asset as at 31 December 20X3?

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter14: Taxes On The Financial Statements

Section: Chapter Questions

Problem 24CE

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