accounting purposes, but uses sum-of-the-years' digit method Daniel Company purchased an equipment costing P2,000,000 on January 1, 2022. The equipment has an estimated useful life Daniel Company of four years, with no residual value. depreciates this equipment using straight-line method for for tax purposes. Assume a 30% tax rate for all years. Daniel Company reports the following income in its income tax return for the years 2022, 2023, 2024 and 2025: 2022 2023 2024 P 800,000 890,000 1,200,000 1,500,000 2025 Other than for the difference in depreciation for the equipment described, there is accounting income and taxable income for years 2022, 2023, 2024 and 2025. no other difference between Daniel's REQUIRED: Compute for Daniel's pre-tax accounting profit for the years 2022, 2023, 2024 and 2025. (a) Compute for the balance of deferred tax liability at the end of 2022, 2023, 2024 and 2025. (b) Prepare entries for current income taxes and deferred income taxes for years 2022, 2023, 2024 and 2025. (c) Compute for the total income tax expense for years 2022, 2023, 2024 and 2025. (d) (e) Compute the profit for years 2022, 2023, 2024 and 2025.

accounting purposes, but uses sum-of-the-years' digit method Daniel Company purchased an equipment costing P2,000,000 on January 1, 2022. The equipment has an estimated useful life Daniel Company of four years, with no residual value. depreciates this equipment using straight-line method for for tax purposes. Assume a 30% tax rate for all years. Daniel Company reports the following income in its income tax return for the years 2022, 2023, 2024 and 2025: 2022 2023 2024 P 800,000 890,000 1,200,000 1,500,000 2025 Other than for the difference in depreciation for the equipment described, there is accounting income and taxable income for years 2022, 2023, 2024 and 2025. no other difference between Daniel's REQUIRED: Compute for Daniel's pre-tax accounting profit for the years 2022, 2023, 2024 and 2025. (a) Compute for the balance of deferred tax liability at the end of 2022, 2023, 2024 and 2025. (b) Prepare entries for current income taxes and deferred income taxes for years 2022, 2023, 2024 and 2025. (c) Compute for the total income tax expense for years 2022, 2023, 2024 and 2025. (d) (e) Compute the profit for years 2022, 2023, 2024 and 2025.

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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Please show each step of calculation. Thanks in advance.
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