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How much is the total tax-related liability as of yearend

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Reference no: EM133051351

Question - Quantum Company reported the following pretax accounting income for several years.

2021 - P500,000

2022 - P720,000

2023 - P680,000

2024 - P650,000

2025 - P730,000

The following pieces of information are given:

There was non-taxable revenue in 2022 amounting to P100,000.

There was a non-deductible expense in 2023 amounting to P20,000.

There was a collection of P125,000 on January 1, 2021 applicable to the total rental income for a five-year operating lease. Said amount is taxable on the year of receipt.

A machinery was purchased on January 1, 2021 for P150,000. The entity depreciated the machinery using the straight-line method for five years. The sum-of-years' digits should be used for tax purposes.

Tax rate is 25%.

Tax payments applicable only to each year's current tax expense are the following:

2021 - P140,000

2022 - P160,000

2023 - P185,000

2024 - P175,000

2025 - P201,000

Required -

1. How much is the total tax-related liability as of yearend 2021?

2. How much is the total tax-related asset as of yearend 2021?

3. How much is the net deferred tax expense/benefit for 2021? [Indicate whether it is an expense of benefit]

4. How much is the total tax-related liability as of yearend 2022?

5. How much is the total tax-related asset as of yearend 2022

6. How much is the net deferred tax expense/benefit for 2022? [Indicate whether it is an expense of benefit]

Reference no: EM133051351

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