A subsidiary sold goods costing P1.2 million to its parent for P1.4 million. All of the inventory is held by the parent at year-end. The subsidiary is 80% owned and the parent and subsidiary operate in different tax jurisdictions. The parent pays taxation at 30% and the subsidiary pays taxation at 30%. Calculate any deferred tax asset that arises on the sale of the inventory to the parent. a. P 60,000 c. P48,000 b. P200,000 d. P80,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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A subsidiary sold goods costing P1.2 million to its
parent for P1.4 million. All of the inventory is held by
the parent at year-end. The subsidiary is 80% owned
and the parent and subsidiary operate in different tax
jurisdictions. The parent pays taxation at 30% and the
subsidiary pays taxation at 30%. Calculate any
deferred tax asset that arises on the sale of the
inventory to the parent.
a. P 60,000
c. P48,000
b. P200,000
d. P80,000
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