Valenciano Manufacturing Corporation reports taxable income of P 829,000 on its income tax return for the year ended December 31, 2006, its first year of operations. Temporary differences between financial income and taxable income for the year are: Tax depreciation in excess of book P 80,000 depreciation Accrual for product liability claims in excess of actual claims 125,000 (estimated product claims payable is a current liability) Reported installment sales income in excess of taxable installment 265,000 sales income (installment receivable is a current asset) The enacted income tax rate for 2006 and all future years. 32% How much should be the total tax expense for 2006?

Valenciano Manufacturing Corporation reports taxable income of P 829,000 on its income tax return for the year ended December 31, 2006, its first year of operations. Temporary differences between financial income and taxable income for the year are: Tax depreciation in excess of book P 80,000 depreciation Accrual for product liability claims in excess of actual claims 125,000 (estimated product claims payable is a current liability) Reported installment sales income in excess of taxable installment 265,000 sales income (installment receivable is a current asset) The enacted income tax rate for 2006 and all future years. 32% How much should be the total tax expense for 2006?

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter14: Taxes On The Financial Statements

Section: Chapter Questions

Problem 4BCRQ

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