Required:Total deferred tax liability- December 31, 20x6Total deferred tax asset at December 31, 20x6Current income tax expense for the year ended December 31,20x6Total income tax expense for 20x6 GUCCI Corp. in its first year of operations has the following differences between the carrying value and tax base of its assetsand liabilities at the end of 20x6.Carrying ValueP 800,00040,000Tax BaseEquipment (net)Estimated warranty liabilityGUCCI estimates that the warranty liability will be settled in 20x7The difference in equipment (net) will result in taxable amounts as shown belowP 680,000POYearAmount20x7P 40,00020x860,00020x920,000The company has taxable income of P 800,000 for 2016. The income tax rate is 30%.

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GUCCI Corp. in its first year of operations has the following differences between the carrying value and tax base of its assets and liabilities at the end of 20x6. Carrying Value Tax Base Equipment (net) Estimated warranty liability GUCCI estimates that the warranty liability will be settled in 20x7 The difference in equipment (net) will result in taxable amounts as shown below P 800,000 P 680,000 40,000 PO Year Amount P 40,000 60,000 20,000 20x7 20x8 20x9 The company has taxable income of P 800,000 for 2016. The income tax rate is 30%.

GUCCI Corp. in its first year of operations has the following differences between the carrying value and tax base of its assets and liabilities at the end of 20x6. Carrying Value Tax Base Equipment (net) Estimated warranty liability GUCCI estimates that the warranty liability will be settled in 20x7 The difference in equipment (net) will result in taxable amounts as shown below P 800,000 P 680,000 40,000 PO Year Amount P 40,000 60,000 20,000 20x7 20x8 20x9 The company has taxable income of P 800,000 for 2016. The income tax rate is 30%.

SWFT Comprehensive Vol 2020

43rd Edition

ISBN:9780357391723

Author:Maloney

Publisher:Maloney

Chapter26: Tax Practice And Ethics

Section: Chapter Questions

Problem 32P

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