Part B - Question 1
Note- Please show all workings where necessary and you may use additional space
Please write your workings/explanations and answers in Blue cells
(a) Prepare a statement reconciling net profit with taxable income
Hot Pink Batts Pty Ltd
Amount
Net Profit per Financial Report
$
Net Profit
ADD BACK:
ATO Penalties 4,000.00
Provision for warranty 30,000.00
Tax Withheld US 4,000.00
Depcn Accting 60,000.00
Equals ADJUSTED NET PROFIT
LESS:
warranty exp 11,000.00
Depcn Tax 41,700.00
Computer Written off 900.00
Total less amount
Equals TAXABLE INCOME
(b) Calculate the net tax payable by the company for the year, clearly
sh
Tax on Taxable Income $ 174900
Less PAYG
Less FITO (working notes )
Tax Payable/(Refundable)
Additional Working
FITO
Tax on 174900@27.5%
Less: Tax on 162900@27
offset available =
, (c) Who would you consult if you required advice and guidance to
deter
Write your ans
First step of Any advice or guidance seeking would be Tax Practioner board
(TPB) re
ATO also provides various sources
1) ATO advice products - rulings
2) ATO uidance products / Tailored Technical assistance
A special service for registers tax agents assistance: Complex issue resolution
servic Also consulting Precedential ATO views,
Professional Accounting Bodies (Recoginises by TPB) : CAANZ, CPA Australia ,
NTAA, ICAEW, Law Society - NSW, The Tax institute, royal institute of
Chartered Surveyars
AAT and Courts provide further remedies, when required. The Courts and AAT
follo Decisions made by courts and AAT in the past serve as guide line to
interpret any cu
, Tax on Taxable Income $
Note- Please show all workings where necessary and you may use additional space
Please write your workings/explanations and answers in Blue cells
(a) Prepare a statement reconciling net profit with taxable income
Hot Pink Batts Pty Ltd
Amount
Net Profit per Financial Report
$
Net Profit
ADD BACK:
ATO Penalties 4,000.00
Provision for warranty 30,000.00
Tax Withheld US 4,000.00
Depcn Accting 60,000.00
Equals ADJUSTED NET PROFIT
LESS:
warranty exp 11,000.00
Depcn Tax 41,700.00
Computer Written off 900.00
Total less amount
Equals TAXABLE INCOME
(b) Calculate the net tax payable by the company for the year, clearly
sh
Tax on Taxable Income $ 174900
Less PAYG
Less FITO (working notes )
Tax Payable/(Refundable)
Additional Working
FITO
Tax on 174900@27.5%
Less: Tax on 162900@27
offset available =
, (c) Who would you consult if you required advice and guidance to
deter
Write your ans
First step of Any advice or guidance seeking would be Tax Practioner board
(TPB) re
ATO also provides various sources
1) ATO advice products - rulings
2) ATO uidance products / Tailored Technical assistance
A special service for registers tax agents assistance: Complex issue resolution
servic Also consulting Precedential ATO views,
Professional Accounting Bodies (Recoginises by TPB) : CAANZ, CPA Australia ,
NTAA, ICAEW, Law Society - NSW, The Tax institute, royal institute of
Chartered Surveyars
AAT and Courts provide further remedies, when required. The Courts and AAT
follo Decisions made by courts and AAT in the past serve as guide line to
interpret any cu
, Tax on Taxable Income $
