On December 31, 2020, Landmark Company reported the following: Income before tax for accounting purposes, P11,850,000; Rent expense for financial accounting purposes is P1,500,000 while rent expense for tax purposes is P1,050,000; Tax depreciation is P3,000,000 while accounting depreciation is P1,500,000; Loss on a case incurred but not yet paid so tax deductible in the future is P600,000. Income tax rate is 30%. a. What is the amount of taxable temporary difference? * b. What is the amount of total deductible temporary difference? * c. Compute for the current tax expense. * d.Compute for the deferred tax expense. * e.What is the amount of deferred tax asset? * f.Compute for the net income after tax.
On December 31, 2020, Landmark Company reported the following: Income before tax for accounting purposes, P11,850,000; Rent expense for financial accounting purposes is P1,500,000 while rent expense for tax purposes is P1,050,000; Tax depreciation is P3,000,000 while accounting depreciation is P1,500,000; Loss on a case incurred but not yet paid so tax deductible in the future is P600,000. Income tax rate is 30%. a. What is the amount of taxable temporary difference? * b. What is the amount of total deductible temporary difference? * c. Compute for the current tax expense. * d.Compute for the deferred tax expense. * e.What is the amount of deferred tax asset? * f.Compute for the net income after tax.
Chapter6: Deductions And Losses: In General
Section: Chapter Questions
Problem 56P
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On December 31, 2020, Landmark Company reported the following: Income before tax for accounting purposes, P11,850,000; Rent expense for financial accounting purposes is P1,500,000 while rent expense for tax purposes is P1,050,000; Tax depreciation is P3,000,000 while accounting depreciation is P1,500,000; Loss on a case incurred but not yet paid so tax deductible in the future is P600,000. Income tax rate is 30%.
a. What is the amount of taxable temporary difference? *
b. What is the amount of total deductible temporary difference? *
c. Compute for the current tax expense. *
d.Compute for the deferred tax expense. *
e.What is the amount of deferred tax asset ? *
f.Compute for the net income after tax. *
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