10
10
income
tax expense:
Cash 675,000
Accounts receivable (net) 2,695,000
Inventory 2,185,000
Property, plant, and equipment (net) 10,245,000
Accounts payable and accrued liabilities 1,800,000
Income tax payable 1,500,000
Deferred tax liability 750,000
Share capital 2,500,000
Share premium 3,000,000
Retained earnings, January 1 3,350,000
Net sales and other revenue 15,000,000
Cost and expenses 10,000,000
Income tax expense 2,100,000
27,900,000 27,900,000
The accounts receivable included P1,000,000 due from customers and payable in quarterly installments of P125,000. The
last payment is due December 30, 2X22. During the year, the estimated tax payment of P600,000 was charged to income
tax expense. The income tax rate is 30% on all types of income.
Cash P 675,000
Accounts Receivable 2,195,000
Inventory 2,185,000
Total Current Asset P 5,055,000
c. Retained earnings
Net sales and other revenue P 15,000,000
Less: Cost and expenses 10,000,000
Income before tax 5,000,000
Less: Income Tax 1,500,000
Net Income 3,500,000
Add: Retained Earnings, January 1 3,350,000
Retained Earnings, December 31 P 6,850,000