Warriors Company reported taxable income of Php8,000,000 in the income tax return for the first year of operations. The enacted income tax rate is 30% for the current and future years. Temporary differences between financial income and taxable income for the year are: Tax depreciation in excess of book depreciation Accrual for product liability claim in excess of 800,000.00 actual claim 1,200,000.00 Reported installment sales income in excess of taxable installment sales income 2,600,000.00

Warriors Company reported taxable income of Php8,000,000 in the income tax return for the first year of operations. The enacted income tax rate is 30% for the current and future years. Temporary differences between financial income and taxable income for the year are: Tax depreciation in excess of book depreciation Accrual for product liability claim in excess of 800,000.00 actual claim 1,200,000.00 Reported installment sales income in excess of taxable installment sales income 2,600,000.00

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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PROBLEM 3: EXERCISES 1. Park Co. has the following information for the current year: Pretax income 900,000 Penalty on late filing of income tax return Interest on borrowings incurred to acquire tax- 30,000 exempt securities Interest income on government securities Excess of tax depreciation over book depreciation Excess of revenue recognized over taxable income Excess of provision over actual expenditures Advanced rent received (taxable upon receipt) Unrealized loss on change in fair value of investment Temporary differences as at the beginning of the year 3,000 9,000 60,000 45,000 54,000 12,000 18,000 Income tax rate 30%