What is the income tax payable for 2020? (Apply the pre-CREATE law rulings) M&M Company's income statement for the year ended December 31, 2020 (considered as the fifth yearof operations), shows pretax income of P3,000,000. The company's tax rate for 2020 is 30%. The followingitems are treated differently on the tax return and in the accounting records:Accounting RecordsP240,000440,000Tαx RetumRent revenueP140,000Depreciation expensePremium on officers' life insurance and the familyis the beneficiaryThe records also show that the net sales are P60M; cost of goods sold is P29M; sales returns andallowances, P550,000; & sales discounts, P650,000. hat is the income tax payable for 2020? (Apply thepre-CREATE law rulings)560,000280,000

Solution: taxable income = pretax financial income - excess revenue under accounting records -…

M&M Company's income statement for the year ended December 31, 2020 (considered as the fifth of operations), shows pretax income of P3,000,000. The company's tax rate for 2020 is 30%. The follo items are treated differently on the tax return and in the accounting records: Ταx Retum P140,000 Accounting Records P240,000 Rent revenue Depreciation expense Premium on officers' life insurance and the family is the beneficiary The records also show that the net sales are P60M; cost of goods sold is P29M; sales return 560,000 440,000 280,000

M&M Company's income statement for the year ended December 31, 2020 (considered as the fifth of operations), shows pretax income of P3,000,000. The company's tax rate for 2020 is 30%. The follo items are treated differently on the tax return and in the accounting records: Ταx Retum P140,000 Accounting Records P240,000 Rent revenue Depreciation expense Premium on officers' life insurance and the family is the beneficiary The records also show that the net sales are P60M; cost of goods sold is P29M; sales return 560,000 440,000 280,000

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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