JAY Co. reported net income for the current year 2021 at ₱2,395,000 before taxes. Included in the determination of the said net income were: Non-deductible expenses ₱ 319,200 Accrued warranty expenses ₱ 54,000 Rental payments made in advance ₱ 210,000 Advance collections from customers ₱ 171,500 Non-taxable income ₱ 125,800 Provision for probable losses ₱ 65,000 The income tax rate is 30% and is not expected to change in the future. Required: 4. What is the total deferred tax liability to be presented in the 2021 Statement of Financial Position? 5. Assuming that the expected income tax rate for the following year is 32%, what is the total tax expense? 6. Assuming that the expected income tax rate for the following year is 32%, what is the total deferred tax liability?
JAY Co. reported net income for the current year 2021 at ₱2,395,000 before taxes. Included in the determination
of the said net income were:
Non-deductible expenses ₱ 319,200
Accrued warranty expenses ₱ 54,000
Rental payments made in advance ₱ 210,000
Advance collections from customers ₱ 171,500
Non-taxable income ₱ 125,800
Provision for probable losses ₱ 65,000
The income tax rate is 30% and is not expected to change in the future.
Required:
4. What is the total
5. Assuming that the expected income tax rate for the following year is 32%, what is the total tax
expense?
6. Assuming that the expected income tax rate for the following year is 32%, what is the total deferred
tax liability?
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