In preparing the 2021 Annual Income Tax Return of Nicanor, the following information were culled from his accounting records: Gross sales – Php 2,500,000 Cost of sales – Php 1,000,000 Salaries and wages – Php 100,000 Rent Expense – Php 100,000 Depreciation – Php 100,000 Utilities Expense – Php 100,000 Repairs and Maintenance – Php 100,000 Other income: Rental income – Php 1,000,000 Interest income from bank deposits in Bank of the Pelepens – Php 100,000 Dividends from ABC Corp., a DC – Php 100,000 Cash Prizes – Php 100,000 The duly filed 1st quarterly income tax return indicated that Nicanor opted 8% taxation. In addition, he provided you the following information on other assets which he disposed of during the year: Real property classified as capital asset: Consideration indicated in the Deed of Absolute Sale (DOAS) – Php 20 Million Zonal value of lot – Php 10 Million Assessor’s fair value of lot – Php 5 Million Assessor’s fair value of house – Php 5 Million Appraiser’s value – Php 25 Million Shares of stocks not listed in stock exchange: Selling price of shares of stocks – Php 2,000,000 Price of shares of stocks when he purchased the same last year – Php 1,000,000 Audited Financial Statements of the company disclosed the following: Balance Sheet: Asset - Php 10 Million Liability – Php 7 Million Stockholders’ Equity – Php 3 Million Income Statement: Revenue – Php 5 Million Cost and Expense – Php 3 Million Net Income – Php 2 Million Additional information: Outstanding shares of stocks is 10,000 and cost to transfer shares to new buyer is Php 100,000. What is the correct income tax due of Nicanor for the taxable year 2021? Group of answer choices a. Php 490,000 d. Php 190,000 b. Php 554,000 c. Php 522,000
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In preparing the 2021 Annual Income Tax Return of Nicanor, the following information were culled from his accounting records:
Gross sales – Php 2,500,000
Cost of sales – Php 1,000,000
Salaries and wages – Php 100,000
Rent Expense – Php 100,000
Utilities Expense – Php 100,000
Repairs and Maintenance – Php 100,000
Other income:
Rental income – Php 1,000,000
Interest income from bank deposits in Bank of the Pelepens – Php 100,000
Dividends from ABC Corp., a DC – Php 100,000
Cash Prizes – Php 100,000
The duly filed 1st quarterly income tax return indicated that Nicanor opted 8%
In addition, he provided you the following information on other assets which he disposed of during the year:
Real property classified as capital asset:
Consideration indicated in the Deed of Absolute Sale (DOAS) – Php 20 Million
Zonal value of lot – Php 10 Million
Assessor’s fair value of lot – Php 5 Million
Assessor’s fair value of house – Php 5 Million
Appraiser’s value – Php 25 Million
Shares of stocks not listed in stock exchange:
Selling price of shares of stocks – Php 2,000,000
Price of shares of stocks when he purchased the same last year – Php 1,000,000
Audited Financial Statements of the company disclosed the following:
Balance Sheet: Asset - Php 10 Million
Liability – Php 7 Million
Income Statement: Revenue – Php 5 Million
Cost and Expense – Php 3 Million
Net Income – Php 2 Million
Additional information: Outstanding shares of stocks is 10,000 and cost to transfer shares to new buyer is Php 100,000.
What is the correct income tax due of Nicanor for the taxable year 2021?
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