The Following Information Relates to Godfrey Limited for the Year $\quad$

question 14

Multiple Choice

The following information relates to Godfrey Limited for the year ended 30 June 2016: Accounting profit before income tax (after all expenses have been included) $\quad$ $£ 300,000$
Fines and penalties (not tax deductible) $\quad$ 20,000
Depreciation of plant (accounting) $\quad$ 40,000
Depreciation of plant (tax) $\quad$ 100,000
Long-service leave expense (not a tax deduction until the leave is paid) $\quad$ 8,000
Income tax rate $\quad$$30 \%$
On the basis of this information the current tax liability is:

• A) £74 400;
• B) £78 000;
• C) £80 400;
• D) £99 600.

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Definitions:

Economic Recovery

A period in which economic activity rebounds following a recession or economic downturn, characterized by increases in employment, consumer spending, and growth.

Money Supply

The total amount of money available in an economy at a specific time, including cash and deposits.

Tax Increase

An escalation in the statutory rate imposed by the government on income, goods, services, or transactions.

Tariff Rates

Taxes imposed on imported goods and services, which can affect the price and availability of those goods and services.