A company that has reported an income of sh 2,400,000 computed without subtracting either the bonus or corporation taxes. The bonus is to be based on income after taxes but before deducting bonuses. The corporation tax rate is 30% and the bonus payable is 10%. Required; Calculate the bonus and tax payable Show the double entry in respect of bonus and income taxes payable.

A company that has reported an income of sh 2,400,000 computed without subtracting either the bonus or corporation taxes. The bonus is to be based on income after taxes but before deducting bonuses. The corporation tax rate is 30% and the bonus payable is 10%. Required; Calculate the bonus and tax payable Show the double entry in respect of bonus and income taxes payable.

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter9: Current Liabilities And Contingent Obligations

Section: Chapter Questions

Problem 8RE: Borat Company gives annual bonuses after the end of the year. Borat computes the bonuses based on...

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Suppose that Blake Companys total pretax difference from a change to FIFO was 100,000 and the company pays a bonus of 5% of its income before income taxes and bonus to employees. If Blake pays an additional bonus | based on the change in income, would it recognize any expense? If so, when and how much?
Borat Company gives annual bonuses after the end of the year. Borat computes the bonuses based on the companys net income after deducting the bonuses but before deducting income taxes. Borats income before bonuses and income taxes is 565,000 for the current year. The effective income tax rate is 21%, and the bonus rate is 12%. Calculate Borats bonuses and income taxes for the current year. Round your final answer to two decimal places.
Use the information for the next four (4) questions. Lalala Company has an agreement to pay the sales manager a bonus of 5% of the entity's earnings. The income for the year before bonus and tax is P7,875,000 The income tax rate is 30% of income after bonus.How much is the bonus, assuming bonus is a certain percent of the income before bonus and before tax? How much is the bonus, assuming bonus is a certain percent of income after bonus but before tax? How much is the bonus, assuming bonus is a certain percent of income after bonus and after tax? How much is the bonus, assuming bonus is a certain percent of income after tax but before bonus?
V Co. has an agreement to pay its sales manager a bonus of 7.5% of the company's earnings due to an exemplary performance. The income for the year before bonus and tax is ₱6,890,500. Income tax rate is 32% of income after bonus. The bonus is computed after deduction for both bonus and tax. REQUIRED: 1. Compute for the amount of bonus for the year. 2. Compute for the income after tax for the year
Use the information for the next four (4) questions. ABC Company has an agreement to pay the sales manager a bonus of 5% of the entity's earnings. The income for the year before bonus and tax is P7,875,000 The income tax rate is 30% of income after bonus.1.How much is the bonus, assuming bonus is a certain percent of the income before bonus and before tax? 2.How much is the bonus, assuming bonus is a certain percent of income after bonus but before tax? 3.How much is the bonus, assuming bonus is a certain percent of income after bonus and after tax? 4.How much is the bonus, assuming bonus is a certain percent of income after tax but before bonus?
Use the information for the next four (4) questions. XYZ Company has an agreement to pay the sales manager a bonus of 5% of the entity's earnings. The income for the year before bonus and tax is P7,875,000 The income tax rate is 30% of income after bonus.How much is the bonus, assuming bonus is a certain percent of the income before bonus and before tax? How much is the bonus, assuming bonus is a certain percent of income after bonus but before tax? How much is the bonus, assuming bonus is a certain percent of income after bonus and after tax? How much is the bonus, assuming bonus is a certain percent of income after tax but before bonus?
V Co. has an agreement to pay its sales manager a bonus of 7.5% of the company's earnings due to an exemplary performance. The income for the year before bonus and tax is ₱6,890,500. Income tax rate is 32% of income after bonus. The bonus is computed after deduction for both bonus and tax. Requirements: Compute for the amount of bonus for the year. Compute for the income after tax for the year.
2 An entity reports profit before bonus and taxes of P1,800.0m during the year. The entity has an established policy of paying its top management a 12% bonus on annual profit. The entity is subject to an income tax rate of 30%. Requirements: Compute for the amount of bonus under each of the following bonus schemes: a. Bonus is based on profit before deducting bonus and income tax. b. Bonus is based on profit after deducting bonus but before deducting income tax. C. Bonus is based on profit before deducting bonus but after deducting income tax. d. Bonus is based on profit after deducting both bonus and income tax.
JIMIN Company has an agreement to pay the executive officers a bonus of 5% of the entity’s earnings. The income for the year before bonus and tax is ₱8,750,000. The income tax rate is 30% of income after bonus. Determine the BONUS under each of the following independent assumptions: A. Bonus is based on income before bonus and before tax.B. Bonus is based on income after bonus and after-tax.
Use the information for the next four (4) questions.ZXCVBNM Company has an agreement to pay the sales manager a bonus of 5% of the entity's earnings. The income for the year before bonus and tax is P7,875,000 The income tax rate is 30% of income after bonus.A.) How much is the bonus, assuming bonus is a certain percent of the income before bonus and before tax? B.) How much is the bonus, assuming bonus is a certain percent of income after bonus but before tax? C.) How much is the bonus, assuming bonus is a certain percent of income after bonus and after tax? D.) How much is the bonus, assuming bonus is a certain percent of income after tax but before bonus?
This year AB Company has each of the following items in its income statement. Part A. Gross profit on instalment sales Revenues on long term construction contracts Estimated costs of product warranty contracts Premiums on officers’ life insurance policies as AB Company as beneficiary. Instructions: (a) Under what conditions would deferred income taxes need to be reported in the financial statements? (b) Specify when deferred income taxes would need to be recognized for each of the items above, and indicate the rationale for such recognition. Part B. AB Company’s president has heard that deferred income taxes can be classified in different ways in the balance sheet. Instructions: Identify the conditions under which deferred taxes would be classified as noncurrent item in the balance sheet. What justification exists for such classification?
year before bonus and tax is P5,250,000. The income tax rate a bonus of 5% of the entity's earnings. The income for the Nature Company has an agreement to pay the sales manager Problem 1-29 (ACP) Nature Company has an agreement to pay the sales mana a bonus of 5% of the entity's earnings. The income for year before bonus and tax is P5,250,000. The income tax p is 30% of income after bonus. Required: Determine the bonus under each of the followin independent assumptions: 1 Bonus is a certain percent of the income before bonn and before tax. * f income after bonus h before tax. 3. Bonus is a certain percent of income after bonus and after 2. Bonus 1s a certain percent o tax. 4. Bonus is certain percent elincome.after tax but before bonus