A company is considering an investment of €50.000 made at the beginning of the year for a period of 5 years. At the end of the fifth year the investment will be sold at a scrap value of €10,000. The capital allowances can be claimed at 20% on a straight-line method. The corporation tax is 12.5% and is payable one year in arrears. Cost of capital is 10% Required Determine the tax savings of the investment.

Q: Shipments of inventory to the branch may be billed at other than cost. When billing prices are above…

A: Introduction:- Branch Accounting is the different type of bookkeeping or accounting.…

Q: The Hi Life Co (HL Co) makes sofas. It has recently received a request from a customer to provide a…

A: Direct Materials: Since the fabric is regularly used by HL Co. and is currently sufficiently…

Q: Under its executive stock option plan, Mining Co. granted options on January 1, 2021, that permit…

A: The net worth is represented by the stockholder's equity. It also shows the amount that would be…

Q: n December 31, 2021, Sad Inc. had a P3,000,000 balance in advertising expense account before any…

A: The prepaid expenses are the expenses incurred in cash in advance but not yet due for payment.

Q: 2. MSS Company sells Japanese comics books. On 1 January 2021, a customer, Jupiter Co., owed MSS…

A:

Q: QUESTION 1-(COMPULSORY) 1(a)        Nairobi Ltd…

A: Calculation of depreciation on machinery = 122,000 * 10% = 12,200 Calculation of depreciation on…

Q: On January 1, 2021, Jason Corp. purchased 5-year bonds with a face value of P10,000,000 and a stated…

A: When bonds were classified based on business model of collecting contractual cash flows and to sell,…

Q: Matubig Corporation is VAT registered and a holder of franchise from the government engaged in the…

A: ANSWER Here in this question Matubig corporation is a holder of franchise from government in the…

Q: 0. Nicanor, single, received the following in 2022: Proceeds of his life insurance paid at annual…

A: Gross income refers to the income which involves the wages, retirement distributions, dividends,…

Q: GIVEN: • Taxpayer is a non-stock and non-profit educational institution. • It has been granted with…

A: The correct option with proper explanation are as follows

Q: Calculate the depreciation using the Straight-Line Method for a company that buys a piece of…

A: Depreciation is the allocation of cost of assets over the useful life of the asset. Under straight…

Q: Explain and what is the calculation of the following. Medicare Levy Surcharge Total Tax Liability…

A: Medicare Levy Surcharge (MLS) : The Medicare Levy Surcharge (MLS) is an additional tax on your…

Q: Daxter Bakers is trying to decide whethe Should keep its existing bread-making machi inological…

A: Let us first understand the meaning of opportunity cost Opportunity cost is the benefit foregone…

Q: Rock Creek Bottling Company pays its production manager a salary of $6,000 per month. Salespersons…

A: Cost can be classified into two main categories i.e fixed and variable costs. The fixed cost remains…

Q: On Jan. 1, 2021, ABC Corporation entered into a P5,000,000 IRG 1-10, 9% contract with its bank.…

A: The cash to be received from a contract at any point in time is equal to the initial value of the…

Q: Calculate the debt ratio

A: Debt ratio is a financial ratio which is calculated by dividing the total liabilities by the total…

Q: OFIA had investments in equity securities costing P1,000,000 that were classifies as investment in…

A: When Investments are reclassified at fair value through profit and loss which were earlier…

Q: The taxpayers are husband and wife  with the following data during the taxable year:  Husband:…

A: Income Tax Calculation Here to discuss the details of the calculation of income tax for both Husband…

Q: Problem 9-2 (IAA) Hesay Company provided the following information for the current year: Sales…

A: Cost of goods sold- The cost of goods sold is the cost of producing the goods that a business sells.…

Q: GIVEN: Taxpayer is a proprietary educational institution. Taxable period is 2021. • Financial data:…

A: Income Tax: - Income Tax is the tax that is imposed by the government on the income generated by a…

Q: Pension benefits contributed by the employer affects both the projected benefit obligation and…

A: Under defined benefit pension plan, pension benefits contributed by the employer affects only…

Q: 4. OHW Company's debt to equity ratio is 0.6. Current liabilities are P120,000, long term…

A: Solution Concept Mathematically Working capital               = current assets – current liabilities…

Q: Which of the following is a legal person? Note that it could be several. A State A dog A Limited…

A: A company is a voluntary group of persons formed through the process of law.  Types of company:…

Q: Kibble for Kats is an exempt organization with fross receipts of $585,000. If Kibble for Kats and…

A: Explanation : As per IRS, Maximum penalty for late filing of return is the smaller of $10,500 or 5…

Q: Red Co. has a patent on a communication process. The company has amortized the patent on a…

A:

Q: Prepare a depreciation schedule for the tax purposes (Annual depreciation and Book value) by…

A: In the Declining Balance method, LN calculates each year's total depreciation by applying a constant…

Q: Construct partial income statements, which start with EBIT, for the two firms.

A: Income statement is prepared by the business organizations so as to know how much amount of profit…

Q: A company charges a customer $50 at the end of each month, and its cost per customer is $10 per…

A: Solution Concept Payback period is the period in which the investment is recovered After the payback…

Q: BBB Corporation is a resident foreign corporation with total assets in the Philippines amounting to…

A: The income tax is payable on the earned income. The tax rates in Country P are different for the…

Q: Unger has the following third party and intersegment revenue for its 10 operating segments Third…

A: If total external revenue reported by reportable segments is less than 75% of entities total revenue…

Q: True or false? Statement 1. An agency maintains its own separate books of accounts similar to a…

A: Home office and branch office are working on the principle of same business and one owner. All goods…

Q: Joferlyn corporation leased a building and received P4,000,000 annual payment on June 15, 2015. The…

A: Introduction: It is the amount reported on the balance sheet's asset side. Essentially, it is…

Q: V. Prepare the Trial Balance

A: Trial balance means the statement prepared from ledger account where all debit and credit balance…

Q: So why would we not use standard deduction?

A: Standard deduction is the term which is used in the accounting and it is the portion of income that…

Q: $40,000 6,000 Net income Depreciation 2,000 (800) 1,800 8,000 Increase in accounts receivable…

A: Net cash provided by Operating activities = Net Income + Depreciation expense - Increase in accounts…

Q: On January 1, 2023, the city government provided Swerte Company a zero interest, P6,000,000 loan…

A: In this Question, this is a zero-coupon bond having no interest. Therefore in this, we will…

Q: Devon Corp. is trying to decide whether to lease or purchase a piece of equipment. The total cost…

A: While making the decision between purchasing or leasing the Equipment, net present value between…

Q: Which of the following problems can be most ea client's year-end sales cutoff?

A: Sales revenue represents the revenue of the company by selling the products produced by the company.…

Q: The adjusted trial balance data given below is from Cameron White Company's worksheet for the year…

A: Balance sheet is the financial statement which tells about the financial health of the entity.

Q: 11. As a short term creditor concerned with a company's ability to meet its financial obligation to…

A: Current ratio is the ratio of current assets to the current liabilities which shows the liquidity…

Q: A company is the real estate business and rents offices to clients. On the first day of their…

A: The accrual basis accounting records the revenue and expenses of the period when they are incurred.

Q: Bramble Company applied FIFO toits inventory and got the following results for its ending inventory.…

A: Ending inventory is the worth of the inventory at the end of the period.

Q: ABC corporation produces plastic bottles. Details of cost are given below: Standard unit quantity…

A: Materials price variance is the variance between standard cost of materials and actual cost of…

Q: EM Co.'s budgeted sales and budgeted cost of sales for the coming year are P212,000,000 and…

A: Solution Concept Inventory turnover ratio means the frequency company replaces its inventory…

Q: On March 2, 2022, Gumamela Corporation issued 4,000 shares of 6% cumulative P100 par value…

A: One non- detachable share warrant for one share total mumber of shares warrant =4000 shares x 1…

Q: Exercise 3 -7 1. Martin and Isidore form a partnership with investments of P 1,000,000 and P 500,000…

A: The partnership comes into existence when two or more persons agree to do the business and further…

Q: ASM Company makes a cologne called Allure. The standard cost for one bottle of Allure is as follows:…

A: Variances are calculated to determine the deviations of the actual figures from the budgeted or…

Q: A firm is charged P150 per ton for hauling its raw materials by a trucking company. Forty tons per…

A: Answer -  Part A - Case 1: Given, 150tons/pesos Calculation of Total Cost -   Total cost =…

Q: A state collects $270,000,000 in withheld and estimated tax payments during the 2022 calendar year…

A: Introduction: Revenue is the term for the total sales for a certain reporting period.  It…

Q: Juan Company purchased four convenience store buildings on January 1, 2015 for a total of…

A: Impairment is done when book value of an asset is more than it's recoverable value. In that case the…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.