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CS Midterms With Answers

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Gladya mae Laygo
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40 views4 pages

CS Midterms With Answers

Uploaded by

Gladya mae Laygo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Comprehensive Problem.

Problem 1. X, a seller of goods, reported a financial accounting income amounting to P5,000,000 during the calendar
year 2019. The cost of goods sold was P30,000,000. The operating expenses that were deducted reveal the
following:

a. Salaries Expense

Salaries worked and paid P500,000


Advances to employees 100,000
Accrued salaries 80,000
Total Salaries Expense P680,000

b. Bad debts expense

Accounts written off determined to be worthless P100,000


Estimated uncollectible amount 200,000
Related party bad debts 20,000
Worthless accounts not yet written off 50,000
Total bad debts expense P370,000

c. The retirement expense deducted was P1,000,000. Only P620,000 of which was from the contribution of the
employer.

d. Representation Expense, P500,000.

e. Rent Expense:

Rent P180,000

f. Taxes expense

Municipal taxes and licenses P30,000


Donor’s tax 40,000
Quarterly Income tax 230,000
Total Taxes P300,000

g. Life insurance expense

Premium on employees' group P50,000


insurance
Total life insurance expense P50,000

h. Interest Expense

Interest Expense (bank borrowings) P200,000


Interest Expense (late payment of tax) 20,000
Interest Income (bank deposits) (50,000)
Interest Income (trade notes receivable) (10,000)
Net Interest Expense, deducted P160,000

i. Contributions Expense

Donations to TESDA priority project P500,000


Donations to rooming-in and breast-feeding 200,000
Donations to NGO, (35% for Admin) 100,000
Total Contribution expense P800,000

REQUIRED: Compute for the following

a. Deductible Bad debts expense


b. Deductible Representation Expense

c. Deductible Contributions expense

d. Total Allowable Deductions if X is an Individual

e. Total Allowable Deductions if X is a corporation.

f. Net Income for income tax purposes if X is an individual taxpayer.

g. Net Income for income tax purposes if X is a corporation.

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