| Metric | £ thousands |
| Earnings before tax reported on the income statement | 2,640 |
| Depreciation expense included in earnings before tax | 4,500 |
| Accounting expenses that are not deductible for tax purposes | 2,130 |
| Depreciation expense deductible for tax purposes in first year of operations | 6,340 |
| Corporate tax rate | 25% |
The company’s end-of-year balance sheetwill
most likely
include (in thousands) a deferred tax:
| liability of £733. | |
| asset of £73. | |
| liability of £460. |
Correct.
Deferred tax balances result fromtemporary differences between a company’s income as reported for tax purposesand income reported for financial statement purposes. The temporary differencein this case arises from the difference between the depreciation for accountingpurposes and the depreciation for tax purposes. Because of this difference, thecompany would report more income tax expense than would actually be paid intaxes. The difference is a deferred tax liability.
| Temporary difference balance (in thousands) = Depreciation expense for accounting purposes – Depreciation for tax purposes | £6,340 – £4,500 | £1,840 |
| Deferred tax balance (in thousands) =
|
£1,840 × 25% |
£460 |
|
Year | Year-End Fair Market Value ($ thousands) |
| 2011 | 1,000 |
| 2012 | 600 |
| 2013 | 800 |
| 2014 | 1,300 |
The impact (in $ thousands) on the income statement in2014 will most likely be a gain of:
| 300. | |
| 200. | |
| 500. |
Incorrect.
The revaluation model per IFRS allows theasset to be carried at fair value. If the revaluation decreases the value, asit does here from 2011 to 2012, then later increases the value to the extentthat the losses are reversed, it is recognized in profit and loss, so from $800to $1,000 = $200.
Any increase in excess of the reversal willbe recorded directly in equity in a revaluation surplus account and not on theincome statement: $1,300 – $1,000 = $300.
这个重估价值应该如何理解呢？
谢谢各位了！！
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