26. Kayo Na Company's income statement for the year ended December 31, 2019 shows pretax income ofP2,000,000. The company's tax rate for 2019 is 30%. The following items are treated differently on the taxreturn and in the accounting records:Tax ReturnP140,000560,000Accounting RecordsRent revenueDepreciation expensePremium on officers' life insuranceP240,000440,000180,000The records also show that the gross sales is P60M; cost of goods sold is P29M; sales returns and allowances,P450,000; & sales discounts, P550,000. What is the income tax payable for 2019?В. Р588,000A. P534,000С. Р600,000D. P720,000

Solution: Taxable income = Pretax income - Excess of rent revenue as per books over tax - Excess of…

26. Kayo Na Company's income statement for the year ended December 31, 2019 shows pretax income of P2,000,000. The company's tax rate for 2019 is 30%. The following items are treated differently on the tax return and in the accounting records: Tax Return P140,000 560,000 Accounting Records P240,000 Rent revenue Depreciation expense Premium on officers' life insurance 440,000 180,000 The records also show that the gross sales is P60M; cost of goods sold is P29M; sales returns and allowances, P450,000; & sales discounts, P550,000. What is the income tax payable for 2019? B. P588,000 А. Р534,000 С. Р600,000 D. P720,000

26. Kayo Na Company's income statement for the year ended December 31, 2019 shows pretax income of P2,000,000. The company's tax rate for 2019 is 30%. The following items are treated differently on the tax return and in the accounting records: Tax Return P140,000 560,000 Accounting Records P240,000 Rent revenue Depreciation expense Premium on officers' life insurance 440,000 180,000 The records also show that the gross sales is P60M; cost of goods sold is P29M; sales returns and allowances, P450,000; & sales discounts, P550,000. What is the income tax payable for 2019? B. P588,000 А. Р534,000 С. Р600,000 D. P720,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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