On January 1, 2001, ABC Company acquired a building for P5,000,000.The building is depreciated using straight line method based on a usefullife of 10 years with no residual value. On January 1, 2005, the buildinghas an appraised value of P4, 800, 000. The 2005 pretax accountingincome before depreciation is P9,000,000. The income tax rate is 32%and there are no other temporary differences at the beginning of 2005.4) What is the deferred tax liability arising from the revaluation onJanuary 1, 2005?a. P960,000b. P384,000E P576,000 Black Co., organized on January 2, 2004, had pretax financial statementincome of P500,000 and taxable income of P800,000 for the year endedDecember 31, 2004. The only temporary differences are accrued productwarranty costs, which Black expects to pay as follows:P 100,000P 50,000P 50,000P 100,0002005200620072008The enacted income tax rates are 25% for 2004, 30% for 2005 through2007, and 35% for 2008. Black believes that future years' operations willproduce profits.20)In its December 31, 2004 balance sheet, what amount should Blackreport as deferred tax asset?a. P50,000b. P75,000C. P90,000d. 95,000

In respect of assets If carrying amount is greater than tax base then deferred tax liability…

On January 1, 2001, ABC Company acquired a building for P5,000,000. The building is depreciated using straight line method based on a useful life of 10 years with no residual value. On January 1, 2005, the building has an appraised value of P4, 800, 000. The 2005 pretax accounting income before depreciation is P9,000,000. The income tax rate is 32% and there are no other temporary differences at the beginning of 2005. 4) What is the deferred tax liability arising from the revaluation on January 1, 2005? a. P960,000 b. P384,000

On January 1, 2001, ABC Company acquired a building for P5,000,000. The building is depreciated using straight line method based on a useful life of 10 years with no residual value. On January 1, 2005, the building has an appraised value of P4, 800, 000. The 2005 pretax accounting income before depreciation is P9,000,000. The income tax rate is 32% and there are no other temporary differences at the beginning of 2005. 4) What is the deferred tax liability arising from the revaluation on January 1, 2005? a. P960,000 b. P384,000

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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Purple Ltd purchased a depreciable asset for $900,000 on 1 July 2014. For accounting purposes, it is estimated to have a useful life of 8 years with no residual value. For taxation purposes, the useful life is 6 years with no residual value. The asset is depreciated on a straight-line basis for both accounting and tax purposes. Tax rate is 30%. What is the adjustment required in the deferred tax liability account for the year ended 30 June 2020 and 30 June 2021 respectively in accordance with the requirements of AASB112 Income Taxes? $11,250; $11,250 $11,250; $33,750 $11,250; ($33,750) $11,250; ($11,250)
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On January 1, year 1 ABC. Ltd. had a piece of equipment with a cost of $ 150000 and accumulated depreciation of $ 60000. The company uses the straight line method. The equipment has a useful life of 10 years and a residual value of $ 30000. The equipment was sold on July 1, year 1 for $ 150000. Calculate the gain or loss on disposal. If the amount is a gain, enter the answer as a positive amount below (i.e. 20000). If the amount is a loss, enter the answer as negative amount below (i.e. -20000). Round your final answer to the nearest dollar.
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