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Free ACCA Financial Reporting Practice Questions & Answers

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Question 391

A company's deferred tax asset decreases from 60,000 to 45,000 during the year. What is the deferred tax charge in profit or loss (assuming no OCI items)?

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Question 392

Entity X has the following: accounting profit 400,000; entertaining expense (non-deductible) 20,000; depreciation 50,000; capital allowances (tax depreciation) 80,000; exempt dividend income 10,000. Tax rate 25%. Calculate current tax.

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Question 393

Which of the following is the correct balance sheet presentation of deferred tax?

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Question 394

Which of the following does NOT create a temporary difference?

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Question 395

An entity has a DTA of 50,000 relating to unused tax losses. Due to poor trading conditions, it is now only 40% probable that the losses will be utilised. What is the revised DTA and what is charged to profit or loss?

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Question 396

An asset was purchased for 200,000. Accounting depreciation is straight-line over 10 years. Tax depreciation (capital allowance) is 25% reducing balance. After year 2, calculate the deferred tax liability at a 20% tax rate.

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Question 397

A company with a deferred tax asset of 80,000 (on unused tax losses) reassesses that it is only 60% probable that sufficient future profits will be available. What should happen to the deferred tax asset?

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Question 398

Company X has taxable temporary differences of 400,000 and deductible temporary differences of 150,000. The tax rate is 22%. A deferred tax asset is only recognised to the extent that future profits are probable; management believes 80% of the asset is recoverable. What is the net deferred tax position?

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Question 399

An entity has opening DTL of 80,000 and opening DTA of 20,000. During the year, taxable temporary differences increase by 30,000 and deductible temporary differences decrease by 10,000. Tax rate is 25%. What is the net deferred tax charge or credit for the year in profit or loss?

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Question 400

Entity X has a deferred tax liability of 120,000 at year start. During the year, the tax rate changes from 25% to 20%. At the start, taxable temporary differences were 480,000. At year end, taxable temp diffs = 500,000. Calculate the closing DTL and total deferred tax charge/credit.

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Free ACCA Financial Reporting Practice Questions & Answers

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