The reported pretax financial income of Mechado Company is P1,800,000 and current income tax rate is 30%. Assume the following differences between the financial income and taxable income for the year: 1. Fines paid for late payment of taxes, P15,500 2. Premiums paid on life insurance policy on officers, P200,000. Beneficiary named in the policies is Mechado Company. 3. Impairment loss recognized on goodwill, P90,000 4. Excess of tax depreciation over book depreciation, P30,000 5. Excess of warranty expense over actual expenditures, P27,000 6. Excess of estimated uncollectible accounts for financial reporting over the accounts actually written off for tax reporting. P12,000. 7. Rent collected in advance of period earned, P35,000. Taxable income is * .

The reported pretax financial income of Mechado Company is P1,800,000 and current income tax rate is 30%. Assume the following differences between the financial income and taxable income for the year: 1. Fines paid for late payment of taxes, P15,500 2. Premiums paid on life insurance policy on officers, P200,000. Beneficiary named in the policies is Mechado Company. 3. Impairment loss recognized on goodwill, P90,000 4. Excess of tax depreciation over book depreciation, P30,000 5. Excess of warranty expense over actual expenditures, P27,000 6. Excess of estimated uncollectible accounts for financial reporting over the accounts actually written off for tax reporting. P12,000. 7. Rent collected in advance of period earned, P35,000. Taxable income is * .

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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