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Reconciling Net Profit with Taxable Income, Exams of Finance

Guidance on preparing a statement to reconcile net profit with taxable income. It covers topics such as adding back certain expenses, deducting allowable deductions, and calculating the net tax payable by the company. The document also discusses the sources of advice and guidance that can be consulted for income tax-related issues. Likely useful for university students studying accounting, taxation, or finance-related subjects, as it covers practical applications of reconciling financial statements and calculating tax liabilities.

Typology: Exams

2024/2025

Available from 10/01/2024

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(a) Prepare a statement reconciling net profit with taxable income
FNSACC601 Final Assessment| with 100%
Verified Solutions
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
h
Net Profit per Financial Report
Amount
$
Net Profit
ADD BACK:
Tax Withheld USA
4,000
Provisions for Customer Warranty Claims
30,000
ATO Penalties
4,000
Accounting Depreciation @ accounting rate
60,000
Equals ADJUSTED NET PROFIT
LESS:
Warranty Expenses
11,000.0
Depreciation Tax
56,535.0
Total less amount
Equals TAXABLE INCOME
(b) Calculate the net tax payable by the company for the year, clearly s
Tax on Taxable Income $
160965
Less PAYG
50,000.00
Less FITO
-
3,300.00
Tax Payable/(Refundable)
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Download Reconciling Net Profit with Taxable Income and more Exams Finance in PDF only on Docsity!

(a) Prepare a statement reconciling net profit with taxable income

FNSACC601 Final Assessment| with 100 %

Verified Solutions

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

h

Net Profit per Financial Report Amount $ Net Profit ADD BACK: Tax Withheld USA 4, Provisions for Customer Warranty Claims 30, ATO Penalties 4, Accounting Depreciation @ accounting rate 60,

Equals ADJUSTED NET PROFIT

LESS:

Warranty Expenses 11,000. Depreciation Tax 56,535.

Total less amount

Equals TAXABLE INCOME

(b) Calculate the net tax payable by the company for the year, clearly s

Tax on Taxable Income $ 160965 Less PAYG 50,000. Less FITO - 3,300.

Tax Payable/(Refundable)

Additional Working FITO Tax on 189165@27.5% = 52,020. Less: Tax on (189165-(8000+4000)@27.5% = 48720. Foreign income + Tax Withheld = 8000+4000. Tax offset available $3300 (52020.375 -

Tax on Taxable Income $

below s (if any) 48720.375)

% verified solutions- 2023 - 2024

Write your Reasons or Workings (if applicable) Enter amount here $ As given in the statement (^) 130, 4, 30, 4, 60, 228,500. (90000+98000)30%+(90015%)

owing all your workings

Part B - Question 2

Note- Please show all workings where necessary and you may use additional spa Please write your workings/explanations and answers in Blue cells

(a) Prepare a statement reconciling net profit with taxable income

Net Profit per Financial Report Net Profit ADD BACK: Capital Loss on sale of shares

Equals ADJUSTED NET PROFIT

LESS: (if any) Fully franked Dividends

Total less amount

Equals TAXABLE INCOME

(b) Calculate the net tax payable by the company for the year, clearly

Tax on Taxable Income $ - 55500 PAYG Installment Full Franked Credits Distribution from Unit

Tax Payable/(Refundable)

(c) Calculate ALL losses carried forward by the company

Carried Losses (if any) loss carried forward - 2021 loss carried forward - 2022

Total Carry Forward Lossses

Capital Losses (if any)

capital loss on sale of shares

Total Capital Carry Forward Lossses

Addition

Fully Frank Dividends = 7000 Company tax rate = 30% 3000 (7000/(1-0.3))- 7000

Amount $ Write your Reasons or Workings (if applicable) Enter amount here $ as per statement (^) (58,500.00) 10,000.00 10,000. (48,500.00) 7,000.00 7,000. 7,000. (55,500.00)

showing all your workings

Workings (if any) Amount (80,000.00) (48,500.00) (128,500.00) Workings (if any) Amount ce below

al Workings (if any)

Part C On behalf of Tax on Medicare Levy Low Income Tax Offset On behalf of Tax on Medicare Levy Low Income Tax Offset On balance Tax on Medicare Levy Low Income Tax Offset Total tax payable by the trustee

Presently Entitled Legal Disability Sections of Act Who is Assessed Yes No s97 Beneficiary Yes Yes s98 Trustee No Yes s98 Trustee Yes No s97 Beneficiary Yes No s97 Beneficiary No Yes s98 Trustee Show your workings (^) $ 16800 * 15% 16800 * 2%

(19% x ($16800)) 3,192. (700.00) $2,492. (19% x ($16800)) 16800 * 2%

space below

Amount Distributed 50400 16800 16800 16800 8400 16800 10000 136000

Part B - Question 4

Note- Please show all workings where necessary and you may use additional space below Please write your workings/explanations and answers in Blue cells

a) Calculate Net Partnership Income

Receipt Items Receipt Amount $ Gross fees 610, Gross Bank interest 1, Total Assessable Income Deductible Expense items Deductible Amount $ Int on Over draft 7,000. Other overheads (deductible) 168,000. Wages to employees 250,000. Employees superannuation 10,000. Lease of Equipment 45,000. Interest on Loan - Robert 10,000. Depreciation 34,000. Total Deductible Expenses

Partnership Net Income

Adjusted Net Income Amount $ Gross income (^) 611,000. Deductible Expenses (^) 524,000. Adjusted Net Income

b) Prepare a Partnership Distribution Statement

Distribution - Partnership Net Income Wharf

Write your Reasons or Workings Enter Claimable amount $ 610,000. 1,000. 611,000. Workings (show clearly) Enter Claimable amount $ 7,000. 168,000. 250,000. 10,000. 45,000. 10,000. 34,000. 524,000. 87, Workings (show clearly) Enter amount $ 611,000. (524,000.00) 87,000.

Alexander TOTAL