Chapter 3 (Corporations)

21.

15. Capital Gain taxes =

550,000
* Cap gain on sale of Land in M alaysia.
5M * 6% = 300,000 (see chap 20)

GP from
sales
Div. from
Resident
Bus Exp
Taxable
Income
MCIT
NT
Inc Tax
1Q
2Q
3Q
Bus Tax
Capital
Gain
Tax(Land)

* Cap loss on sale of land & bldg in Philippines

selling price of P4M
4M * 6% = 240,000

on a

* Cap gain on direct sale

(100,000x5%) + (50,000*10%) = 10,000
Final tax on passive income = 10,000 (50,000 * 20%)
Year-end tax =
600,000 (2M * 30%)
Income Tax Exp for the yr= 1,160,000
16. M CIT = 80,000; NT = 300,000;
Income tax for the year = 300,000
17. M CIT = (2,000,000 + 50,000) x 2% = 41,000
NT = (2,050,000 - 2,020,000) x 30% = 9,000
Income tax of the year =
41,000

Capital
Gain Tax
(Shares)
Total
Tax due

18. M CIT = (5M - 2M ) * 2% =

60,000
NT = (5M - 2M - 0.5M ) * 30% = 750,000
Income tax for the year =
750,000

19.
GP from
Sales
Opex
Taxable
Income
MCIT
NT
Inc.T ax
1Q
2Q
3Q
Tax Due

First
500,000

Second
700,000

Third
850,000

Year
990,000

(200,000)
300,000

(280,000)
420,000

(340,000)
510,000

(396,000)
594,000

10,000
90,000
90,000

14,000
126,000
126,000
(90,000)

17,000
153,000
153,000
(90,000)
(36,000)

19,800
178,200
178,200
(90,000)
(36,000)
(27,000)
25,200

90,000

36,000

27,000

20.
First

Second

Third

Year

GP from
sales

500,000

850,000

1,650,000

2,550,000

Opex

(450,000)

(790,000)

(1,600,000)

(2,050,000)

Taxable
Income

50,000

60,000

50,000

500,000

MCIT
NT

10,000
15,000
15,000

17,000
18,000
18,000

33,000
15,000
33,000

51,000
150,000
150,000

(15,000)

(15,000)
(3,000)

(15,000)
(3,000)
(15,000)

15,000

117,000

Inc Tax

1Q
2Q
3Q
Tax Due

15,000

3,000

First
300,000

Second
580,000

Third
930,000

Fourth
1,220,000

5,000

10,000

(185,000)
115,000

(355,000)
230,000

(725,000)
205,000

(820,000)
410,000

6,000
34,500
34,500

11,700
69,000
69,000
(34,500)

18,600
61,500
61,500
(34,500)
(34,500)

34,500

34,500

34,500

34,500

24,600
123,000
123,000
(34,500)
(34,500)
0
54,000
6,000,
but paid
already
(per
tranx)
Net Cap
Loss, so
0
54,000

22. 10th year:

M CIT = 40,000 NT = 30,000
11th year:
M CIT = 80,000
NT = 330,000 - 10,000(excess MCIT) = 320,000

23.
Gross
Income
Opex
Taxable
Income
b4
NOLCO
NOLCO
Taxable
Income
MCIT
NT
Inc Tax
Excess
MCIT
4th yr
5th yr
6th yr
Tax Due
Excess
MCIT
4th yr
5th yr
6th yr

Fourth
800,000

Fifth
600,000

Sixth
700,000

Seventh
900,000

(780,000)
20,000

(580,000)
20,000

(750,000)
(50,000)

(600,000)
300,000

20,000

20,000

(50,000)

(50,000)
250,000

16,000
6,000
16,000

12,000
6,000
12,000

14,000
0
14,000

18,000
75,000
75,000
(10,000)

16,000

12,000

14,000

(6,000)
(14,000)
45,000

10,000

10.000
6,000

10,000
6,000
14,000

0
0
0

7. Income Tax of Cruz & Co. 0, it s a GPP

24.
M CIT
th

7
8th
9th
10th
11th

70,000
10,000
40,000
2,000
45,000

NT
20,000
30,000
15,000
5,000
80,000

Excess
M CIT
50,000
0
25,000
0
0

25.
R/E Beg
Taxable Income
Dividends Paid
Taxes Paid NT
R/E End
Paid in Capital
IATI
IAET

Tax
Due
70,000
0
40,000
0
55,000

Remaining
M CIT
50,000
20,000
45,000
40,000
0

2,100,000
1,000,000
(200,000)
(300,000)
2,600,000
2,300,000
300,000
30,000

26.
On the 2M
Cap Gain Tax -->
Interest on Phil currency bank dep

600,000
300,000
6,000

Total

906,000

Beg R/E
Taxable Income
Tax paid
Capital Gain,net of tax
Interest on Phil currency,net
Dividend Received,net
R/E appropriated
Dividends paid
End R/E
Paid-in Capital
IATI
IAET

4,000,000
2,000,000
(600,000)
700,000
24,000
50,000
(200,000)
(500,000)
5,474,000
5,000,000
474,000
47,400

CHAPTER 4 (PARTNERSHIPS)
6.
Income Tax of Ato & Co. 0, Its a GPP

Distributable
P/L Ratio
Share
Own Income
Total G.Inco me
Less:Expense
Personal Exem.
Taxable Income
Income Tax
Tax w/held
Tax Due

Ato
600,000
50%
300,000
600,000
900,000
(300,000)
(50,000)
550,000
141,000
(45,000)
96,000

Belo
600,000
50%
300,000
700,000
1,000,000
(450,000)
(50,000)
500,000
125,000
(45,000)
80,000

Distributable
P/L Ratio
Share
Own Income
Total G.Inco me
Less:Expense
Personal Exem.
Taxable Income
Income Tax
Tax w/held
Tax Due

Cru z
700,000
50%
350,000
900,000
1,250,000
(460,000)
(50,000)
740,000
201,800
(52,500)
149,300

Diaz
700,000
50%
350,000
500,000
850,000
(600,000)
(50,000)
200,000
37,500
(52,500)
0/(15,000)

8. Income Tax of Feria & Co.

Gross Income
2,000,000
Expenses
1,000,000
Taxable Income
1,000,000
Tax @30%
300,000

Final Tax of 10%

Feria
700,000
50%
350,000
35,000

Go mez
700,000
50%
350,000
35,000

Gross Income
Less:Expense
Personal Exem.
Taxable Income
Income Tax

700,000
(320,000)
(50,000)
330,000
74,000

800,000
(410,000)
(50,000)
340,000
77,000

Total

109,000

112,000

Distributable
P/L Ratio
Share

9. Income Tax of Garcia & Co.

Higher of NT & M CIT
NT: (6,000,000 5,800,000) * 30% = 60,000
M CIT: 6,000,000 * 2% = 120,000

Distributable
P&L Ratio
Share
Final Tax of 10%

Garcia
80,000
50%
40,000
4,000

Gracias
80,000
50%
40,000
4,000