Agrix Company grants its managerial employees the privilege to select acar of their choice with value not exceeding PIM a unit or be given PIMcash benefit to acquire their own cars. It also grants supervisoryemployees car benefits if they actually purchase their cars. The followingdata in relation to the benefits are provided:Car benefits given to a manager, net ofwithholding tax on compensationP900,000Value of cars purchased for 2 managers2,000,000Cash payments to various car suppliers forsupervisory employees1,600,000One manager who did not meet company requirements was allowed topurchase his own car for a price not exceeding PIM, 40% at the expenseof the employer. The manager maximized his benefit.Compute the total monetary value of fringe benefits.

Value of fringe benefit provided to manager who did not meet the requirements = 40% x P1000000

Answered: Agrix Company grants its managerial…

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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Assuming that a Nissan Car Manufacturing Company sold 100 cars to the wholesale trader for OMR 7,500 each plus VAT. The wholesale trader sold all the 100 cars to the retailer showroom for OMR 8,000 each plus VAT. The retailer showroom realized OMR 850,000 after selling all the 100 cars to the local customers plus VAT. Assume the rate of Value Added Tax (VAT) throughout in Oman is 5%. There Input tax credit available in Nissan Car Manufacturing Company account was OMR 42,500. ANSWER QUESTION NO 15 TO 18 Question 15 What will be the total tax burden by the consumers? a. OMR 85,000 b. OMR 42,500 c. OMR 40,000 d. OMR 47,500 Question 16 Which of the following statement will be correct for Nissan Car Manufacturer? a. Tax to be refunded from Government is OMR 5000 b. Tax to be payable to Government is OMR 37,500 c. Tax to be refunded from Government is OMR 42,500 d. Tax to be payable to Government is OMR 5000 Question 17 What will be the…
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Evaluate this using the principles of management and cost accounting.
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