Reference no: EM132974354

Question - Norte De University, a proprietary educational institution, has the following selected information for the taxable year 2X18:

Tuition Fees P12,800,000

Miscellaneous Fees 1,800,000

Interest on Bank Deposits 12,300

Rent Income 350,000

Salaries and Bonuses, all personnel 7,500,000

Other Operating Expenses 3,500,000

Quarterly Income Tax Payments 48,000

An additional school building was built and finished on April 1, 2X18 at the cost of P2,000,000 with a depreciable life of 50 years.

a. Compute the income tax payable assuming the university opted to claim the cost of construction as an outright expense.

b. Compute the income tax payable assuming the university opted to capitalize the cost of building construction.