An entity had:

·      taxable
temporary differences at the end of 20X0 of C100 000.

·      taxable
temporary differences at the end of 20X1 of C120 000.

There were no exempt
temporary differences.

Tax at 30% was levied
in 20X0 but this reduced to 28% in 20X1.

The tax rate reconciliation
presented in the notes to the financial statements for the year ended 31
December 20X1:

Select one:

Question

An entity had:

·      taxable
temporary differences at the end of 20X0 of C100 000.

·      taxable
temporary differences at the end of 20X1 of C120 000.

There were no exempt
temporary differences.

Tax at 30% was levied
in 20X0 but this reduced to 28% in 20X1.

The tax rate reconciliation
presented in the notes to the financial statements for the year ended 31
December 20X1:

Select one:

Answer

a. will not be affected by the
change in tax rate.

Answer

will include a deferred tax income
adjustment of C3 600 as a reconciling item.

Answer

will include a deferred tax income
adjustment of C2 000 as a reconciling item.

Answer

will include a deferred tax expense adjustment of C3 600 as a
reconciling item

Answer

will include a deferred tax expense adjustment of C2 000 as a
reconciling item.

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