XYZ Corporation, already in its 4th year of operation as of 2022, immediately following the taxable...

 

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XYZ Corporation, already in its 4th year of operation as of 2022, immediately following the taxable year in which the corporation commenced its operations. It provided the following data: Given Gross sales Sales returns Cost of goods sold Business expenses 2022 2,040,000 40,000 1,000,000 950,000 Requirements: 1. Compute the income tax payable for 2022 2. Compute the income tax payable for 2023. 3. Compute the income tax payable for 2024. 2023 2,900,000 100,000 700,000 2,100,000 2024 3,000,000 1,500,000 1,200,000 B. Provide what is required on the scenario below. Please answer correctly. On January 1, 20x1, LMN Co. enters into a franchise contract with a customer to grant the right to open a store in a specified location. The store will bear LMN Co.'s trade name and the franchisee will have the right to sell LMN's products for 7 years, starting on the store's commencement of operations. The contract requires a P1,400,000 non-refundable up-front fee and royalty of 5% of the franchisee's subsequent sales. The upfront fee covers the following: - Design for the fitting-out of the franchise's store to conform to LMN's concept. The franchisee will engage a contractor to perform the work and will pay the contractor using its own funds. - Training for both management and staff. - Signage and promotional posters and pamphlets. The franchise contract requires LMN Co. to maintain the brand through product improvements, marketing campaigns, research and development, and other activities that would strengthen the brand's marketing position. The franchisee's new store opens on July 1, 20x1 and reports sales of P9,000,000 for the year. Requirements: 1. Apply 'Steps 2 to 5' of PFRS 15 to identify the following: - The performance obligation(s) in the contract and how the performance obligation(s) are satisfied. - The transaction price and its components. - The allocation of transaction price. - The recognition of revenue from the contract. 2. Provide all the necessary journal entries in 20x1. XYZ Corporation, already in its 4th year of operation as of 2022, immediately following the taxable year in which the corporation commenced its operations. It provided the following data: Given Gross sales Sales returns Cost of goods sold Business expenses 2022 2,040,000 40,000 1,000,000 950,000 Requirements: 1. Compute the income tax payable for 2022 2. Compute the income tax payable for 2023. 3. Compute the income tax payable for 2024. 2023 2,900,000 100,000 700,000 2,100,000 2024 3,000,000 1,500,000 1,200,000 B. Provide what is required on the scenario below. Please answer correctly. On January 1, 20x1, LMN Co. enters into a franchise contract with a customer to grant the right to open a store in a specified location. The store will bear LMN Co.'s trade name and the franchisee will have the right to sell LMN's products for 7 years, starting on the store's commencement of operations. The contract requires a P1,400,000 non-refundable up-front fee and royalty of 5% of the franchisee's subsequent sales. The upfront fee covers the following: - Design for the fitting-out of the franchise's store to conform to LMN's concept. The franchisee will engage a contractor to perform the work and will pay the contractor using its own funds. - Training for both management and staff. - Signage and promotional posters and pamphlets. The franchise contract requires LMN Co. to maintain the brand through product improvements, marketing campaigns, research and development, and other activities that would strengthen the brand's marketing position. The franchisee's new store opens on July 1, 20x1 and reports sales of P9,000,000 for the year. Requirements: 1. Apply 'Steps 2 to 5' of PFRS 15 to identify the following: - The performance obligation(s) in the contract and how the performance obligation(s) are satisfied. - The transaction price and its components. - The allocation of transaction price. - The recognition of revenue from the contract. 2. Provide all the necessary journal entries in 20x1.

Answer rating: 100% (QA)

Compute the income tax payable for 2022 To compute the income tax payable we need to determine the taxable income first The taxable income is calculated by subtracting the deductible expenses from the ... View the full answer