Reference no: EM132795662

Question - Tala Corp. reported net income for the current year 2019 at P10,000,000 before taxes. Included in the determination of the said net income were:

Permanent differences:

Non-deductible expenses P100,000

Non-taxable income 500,000

Temporary differences:

Accrued warranty expenses 250,000

Rental payments made in advance 400,000

Advance collections from customers 500,000

Provision for probable losses 900,000

Income tax rate is 40% and is not expected to change in the future.

Required -

1. How much is the current tax expense?

2. How much is the total tax expense?

3. What is the total deferred tax asset to be presented in the 2019?

4. What is the total deferred tax liability to be presented in the 2019 Statement of Financial position?

5. Assuming that the expected income tax rate for the following year is 35%, what is the total tax expense?

6. Assuming that the expected income tax rate for the following year is 35%, what is the total tax asset?

7. Assuming that the expected income tax rate for the following year is 35%, what is the total tax liability?