Problem 1: JAY Co. reported net income for the current year 2021 at P2,395,000 before taxes. Included in the determination of the said net income were: Non-deductible expenses Accrued warranty expenses Rental payments made in advance Advance collections from customers 319,200 ▸ 54,000 ℗ 210,000 171,500 P125,800 ℗ 65,000 Non-taxable income Provision for probable losses The income tax rate is 30% and is not expected to change in the future. Required: 4. What is the total deferred tax aplity 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?

Problem 1: JAY Co. reported net income for the current year 2021 at P2,395,000 before taxes. Included in the determination of the said net income were: Non-deductible expenses Accrued warranty expenses Rental payments made in advance Advance collections from customers 319,200 ▸ 54,000 ℗ 210,000 171,500 P125,800 ℗ 65,000 Non-taxable income Provision for probable losses The income tax rate is 30% and is not expected to change in the future. Required: 4. What is the total deferred tax aplity 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?

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

Deferred Tax

Deferred tax is an estimated future tax which is made while preparing accounts. It is estimated as a result of past and present transactions in the financial statements. It is not the actual tax which needs to be paid or refundable from the revenue authority, it is an accounting entry. It exists because of the difference between accounting profits and taxable profits.

Question

Please answer in good accounting form. Thankyou

Problem 1:
JAY Co. reported net income for the current year 2021 at P2,395,000 before taxes. Included in the detemination
of the said net income were:
P 319,200
P 54,000
P 210,000
P 171,500
P 125,800
P 65,000
Non-deductible expenses
Accrued warranty expenses
Rental payments made in advance
Advance collections from customers
Non-taxable income
Provision for probable losses
The income tax rate is 30% and is not expected to change in the future.
Required:
4. What is the total deferred tax aDility 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?

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