Mr. B, purely engaged in business had the following for the given year: Revenue P800,000 Cost of sales 200,000 Business expenses 150,000 Other (non-operating) business income Interest from bank deposit 20,000 Gain from Capital asset (holding period of 5 months) 25,000 Capital loss - Real property located in the Philippines (Cost 100,000 P1,000,000); Appraisal value P5,000,000 Capital gain - shares of stock sold directly to buyer 1,000,000 Capital gain - shares of stock sold thru PSE (not meet the minimum 1,000,000 public ownership) How much is taxable income, if Mr. B opted for optional standard deduction?

Mr. B, purely engaged in business had the following for the given year: Revenue P800,000 Cost of sales 200,000 Business expenses 150,000 Other (non-operating) business income Interest from bank deposit 20,000 Gain from Capital asset (holding period of 5 months) 25,000 Capital loss - Real property located in the Philippines (Cost 100,000 P1,000,000); Appraisal value P5,000,000 Capital gain - shares of stock sold directly to buyer 1,000,000 Capital gain - shares of stock sold thru PSE (not meet the minimum 1,000,000 public ownership) How much is taxable income, if Mr. B opted for optional standard deduction?

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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Concept explainers

Emergency Fund

The emergency fund is an amount that is kept aside to meet financial emergencies such as medical expenses and debt settlements. Emergency funds reduce the burden on people during their hardships. People save small portions of their earnings or paychecks as emergency funds to meet financial emergencies. Emergency funds should be saved or invested in such a way that they must be easily liquidated during emergencies. The main purpose of an emergency fund is its availability when required.

Question

Mr. B, purely engaged in business had the following for the given year:
Revenue
P800,000
Cost of sales
200,000
Business expenses
150,000
Other (non-operating) business income
Interest from bank deposit
20,000
Gain from Capital asset (holding period of 5 months)
25,000
Capital loss - Real property located in the Philippines (Cost
100,000
P1,000,000); Appraisal value P5,000,000
Capital gain - shares of stock sold directly to buyer
1,000,000
Capital gain - shares of stock sold thru PSE (not meet the minimum
1,000,000
public ownership)
How much is taxable income, if Mr. B opted for optional standard deduction?

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