The following are the records of a domestic corporation:Description201820192020Gross sales2,800,000.00 5,000,000,00 900,000.00Cost of sales2,300,000.00 1,500,000.00 350,000.00Dividend - NRFC150,000.0040,000.00Royalty income earned withinPhilippines50,000.00100,000.00 80,000.00Interest income on notes receivable28,000.00 16,400.00Business expenses700,000.00 3,500,000.00 500,000.00Determine the amount of taxable income/floss) for the year 2020 assuming the taxpayeropted to use the optional standard deductions.

Tax is calculated on the income earned by an individual from all the sources of income such as…

Answered: Determine the amount of taxable…

Determine the amount of taxable income/(loss) for the year 2020 assuming the taxpayer opted to use the optional standard deductions.

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

Fringe Benefit Tax

Fringe benefits are in addition to the compensation that companies give to their employees. It is an additional benefit above the stated salary. It helps to keep the employees of the firm motivated as sometimes the only salary is not enough to retain the quality employees of the firm. There are different types of fringe benefits. Fringe benefits are given in both private as well as public enterprises.

Question

The following are the records of a domestic corporation:
Description
2018
2019
2020
Gross sales
2,800,000.00 5,000,000,00 900,000.00
Cost of sales
2,300,000.00 1,500,000.00 350,000.00
Dividend - NRFC
150,000.00
40,000.00
Royalty income earned within
Philippines
50,000.00
100,000.00 80,000.00
Interest income on notes receivable
28,000.00 16,400.00
Business expenses
700,000.00 3,500,000.00 500,000.00
Determine the amount of taxable income/floss) for the year 2020 assuming the taxpayer
opted to use the optional standard deductions.

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