In 2014, PEACE COMPANY received interest income of 100,000 on government obligations and P600,000 in royalties under a licensing agreement. Royalties are reported as taxable income in the year received, but in the financial statements, royalties are recognized as income in the year earned and amount to P400,000 for the year ended December 31, 2014. The effective income tax rate of Collector Corporation is 32%. Using the balance liability method, by what amount would the deferred income tax asset account balance increase?  a. P32,000 b. P80,000 c. P96.000 d. 64, 000

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Filing Federal Income Tax Return

A tax is the amount of money paid to the government on the revenue earned by the individual or business organization. It acts as an income for the government and an expense for the individual or business organization. There are different regulations regarding filing an income tax return in other countries.