An entity was organized on January 1, 2021. The entity had pretax accounting income of P5,000,000 and taxable income of P7,000,000 for the current year. The only temporary difference is accrued product warranty cost that is expected to be paid in 2022. The enacted tax rates are 20% for 2021 and 25% for 2022 and thereafter. What amount should be reported as total income tax expense in the income statement for 2021?
An entity was organized on January 1, 2021. The entity had pretax accounting income of P5,000,000 and taxable income of P7,000,000 for the current year. The only temporary difference is accrued product warranty cost that is expected to be paid in 2022. The enacted tax rates are 20% for 2021 and 25% for 2022 and thereafter. What amount should be reported as total income tax expense in the income statement for 2021?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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B. An entity was organized on January 1, 2021. The entity had pretax accounting income of P5,000,000 and taxable income of P7,000,000 for the current year. The only temporary difference is accrued product warranty cost that is expected to be paid in 2022. The enacted tax rates are 20% for 2021 and 25% for 2022 and thereafter.
What amount should be reported as total income tax expense in the income statement for 2021?
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