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Wert Company, a VAT-registered taxpayer, purchased P600,000 worth of goods and sold the same for P1,200,000.
1.) Assuming that the business operation of Wert Company is limited to Philippine residents, what is the total business tax it will report on its sales?
2.) Assuming the purchases were import and the sales were exports, compute the Business Tax.
2.) Assuming the purchases were import and the sales were exports, compute the Total Consumption Tax.
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- a) Explain, in three sentences or less, ‘cross-credit’ in relation to the foreign tax credit. Make sure to identify the problem, and how cross-crediting solves the problem. b) Treadwell, Inc. had $2,500,000 taxable income, $250,000 of which was generated by business activities in foreign jurisdictions. If Treadwell paid $55,500 foreign tax to Utopia. Compute the following: US tax paid______________________ Worldwide tax paid_______________Who is the person statutorily liable to pay the consumption tax on local sale of goods and services? *SellerBuyerBoth Seller and BuyerAnswer not given Which is wrong? * International carriers doing business in the Philippines shall pay a tax equivalent to 3% of their quarterly gross receipts derived from the transport of cargoes, baggage, or mails from the Philippines to another country. International carrier's transport of passenger is exempt from tax. Keepers of garage are subject to 3% common carrier’s tax regardless of the amount of their gross receipts. All common carriers are subject to VAT on their transport of passengers or cargoes by water or by air Who is the person statutorily liable to pay the consumption tax on local sale of goods and services? * SellerBuyerBoth Seller and BuyerAnswer not givenAssume the following transactions with the corresponding invoice cost, inclusive of Value Added Tax, if applicable: Apol, non-vat taxpayer, sells to LJ, vat taxpayer P89,600LJ, vat taxpayer, sells to Chris, vat taxpayer P134,400Chris, vat taxpayer, sells to Abi P201,600Abi, nonvat taxpayer, exported the goods in Canada P300,000 Required: Determine the following:A Vat payable of ApolB Vat payable of LJC Vat payable of ChrisD Vat payable of Abi
- San Carlos Corporation, a U.S. multinational, had pretax U.S. source income and foreign source income as follows: U.S. source income $ 400,000 Foreign source income—Country W 300,000 Total $ 700,000 San Carlos paid $60,000 income tax to Country W. Assume San Carlos’ foreign source income does not qualify as foreign-derived intangible income. Calculate San Carlos' tax savings if it takes a foreign tax credit rather than deducting this tax. $100,000 $66,000 $47,400 $0Many Mountains, Incorporated is a U.S. multinational corporation. This year, it had the following income. U.S. source income Foreign source income: Country X Country Y Total Multiple Choice O Many Mountains paid $15,000 income tax to Country X and $28,500 income tax to Country Y. Assume Many Mountains' foreign source income does not qualify as foreign- derived intangible income. Compute Many Mountains' allowable foreign tax credit. $15,000 $18.500 $33.500 $ 65,000 105,000 $35,700 $ 580,000 170,000 $750,000San Carlos Corporation, a U.S. multinational, had pretax U.S. source income and foreign source income as follows: U.S. source income $ 400,000 300,000 Foreign source income-Country W Total $ 700,000 San Carlos paid $60,000 income tax to Country W. Assume San Carlos' foreign source income does not qualify as foreign-derived intangible income. Calculate San Carlos' tax savings if it takes a foreign tax credit rather than deducting this tax.
- 1. Which of the following is not deductible from gross income? a. Transportation expense from the main office to the branch b. Transportation expense from home to the office and from the office back to home c. Travel expenses on business trips d. Travel expenses while away from home in the pursuit of trade, business or profession. 2. Examples of taxes that are deductible except: a. Occupation tax b. Privilege tax c. Documentary stamp tax d. Philippine income taxA supplier imported goods and then sold them to a distributor for a value of 920,000 riyals inclusive of tax, then the distributor sold them to a store for a value of 1,035,000 riyals inclusive of tax, and the entire merchandise was sold to consumers for an amount of 1,150,000 riyals.Required :1- Calculating the value of the value-added tax that must be transferred to the General Authority of Zakat and Income and who will transfer it? (If you know that the tax rate is 15%)2- What is the amount of VAT transferred by the distributor to the direct authority?3- Write the journal entries in the distributor's accounts?ABC corporation provided the following data for calendar year ending December 31, 2021 ($1 = P50). Use new tax rate under CREATE Law (RA 11534) Philippines: Gross Income - P4,000,000 Deductions - P2,500,000 Abroad: Gross income - $40,000 Deductions - $15,000 Income tax paid - $3,000 g. If it is a resident international carrier, compute for its income tax. h. If it is a non-resident cinematographic film owner/lessor, compute for its income tax. i. if it is a non- resident lessor of vessels, compute for its income tax.
- XYZ corporation provided the following data for calendar year ending December 31, 2021 ($ 1= P50). Use new tax rate under CREATE Law (RA 11534) Philippines Abroad Gross income P4, 000, 000 $ 40, 000 Deductions 2, 500, 000 $ 15, 000 Income Tax Paid $ 3, 000 REQUIRED: Compute for the below: A. If it opts to claim the tax paid abroad as deduction from gross income, compute for its income tax.Elmo, Incorporated is a U.S. corporation with a branch office in foreign country Z. During the current year, Elmo had $392,000 of U.S. source income and $34,500 of foreign source income from Z, on which Elmo paid $16,100 of country Z income tax. Required: a. Calculate Elmo's U.S. tax liability before foreign tax credit, maximum foreign tax credit allowable, and net U.S. tax liability after foreign tax credit. b. If Elmo had paid only $3,795 of country Z income tax, calculate Elmo's foreign tax credit allowable and net U.S. tax liability after foreign tax credit. Complete this question by entering your answers in the tabs below. Required A Required B Calculate Elmo's U.S. tax liability before foreign tax credit, maximum foreign tax credit allowable, and net U.S. tax liability after foreign tax credit. Note: Do not round any intermediate division. U.S. tax liability before foreign tax credit Maximum foreign tax credit allowable Net U.S. tax liability after foreign tax credit Amount $…XYZ corporation provided the following data for calendar year ending December 31, 2021 ($ 1= P50). Use new tax rate under CREATE Law (RA 11534) Philippines Abroad Gross income P4, 000, 000 $ 40, 000 Deductions 2, 500, 000 $ 15, 000 Income Tax Paid $ 3, 000 REQUIRED: Compute for the below: a. If it is a domestic corporation, compute for its income tax after tax credit. b. If it is a resident corporation, compute for its income tax. c. If it is a non-resident corporation, compute for its income tax. d. If it opts to claim the tax paid abroad as deduction from gross income, compute for its income tax.