Compute the deferred tax liability at year end

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Question - JCM Co. reported taxable income of P8,000,000 in its income tax return for the first year of operations. The entity revealed the following temporary differences between financial income and taxable income for the year.

Tax depreciation in excess of book depreciation - P800.000

Accrual of product liability claim in excess of actual claim - P1.200.000

Reported installment sales income in excess of taxable installment sales income - P2.600.00

Income tax rate -30%

Required - Compute the deferred tax liability at year end.

Reference no: EM133171492

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