4-13. Conchita Corporation's only temporary difference at December 31, 2019 is caused by a P2,000,000 deferred gain for tax purposes for an installment sale of a plant asset, and related receivable is due in equal installments in the financial years ending December 31, 2021 and December 31, 2022. The related deferred tax liability at December 31, 2019 was P640,000, based on the tax rate of 32%. A new tax rate of 30% is enacted and is expected to become effective for years ending on and after December 31, 2020. Taxable profit is the same as financial profit for the year 2020, which is P3,000,000. REQUIRED: (a) (b) (b) Determine the amount of deferred tax liability at December 31, 2020. Compute the total amount of income tax expense for the year 2020, identifying separately the current portion and the deferred portion. Prepare the entries for income tax for the year ended December 31, 2020.

4-13. Conchita Corporation's only temporary difference at December 31, 2019 is caused by a P2,000,000 deferred gain for tax purposes for an installment sale of a plant asset, and related receivable is due in equal installments in the financial years ending December 31, 2021 and December 31, 2022. The related deferred tax liability at December 31, 2019 was P640,000, based on the tax rate of 32%. A new tax rate of 30% is enacted and is expected to become effective for years ending on and after December 31, 2020. Taxable profit is the same as financial profit for the year 2020, which is P3,000,000. REQUIRED: (a) (b) (b) Determine the amount of deferred tax liability at December 31, 2020. Compute the total amount of income tax expense for the year 2020, identifying separately the current portion and the deferred portion. Prepare the entries for income tax for the year ended December 31, 2020.

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter14: Taxes On The Financial Statements

Section: Chapter Questions

Problem 4BCRQ

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