ANSWER: A

Accounting profit P10,000,000

Nondeductible expense- life insurance 100,000
expense

Nontaxable income- interest on LTCD (200,000)

Accounting profit subject to income tax 9,900,000
Deductible temporary differences (5,000,000)
Taxable profit 1,100,000
P6,000,000
Current tax expense (P6,000,000 x 35%) P2,100,000

Current tax is the amount of income taxes payable (recoverable)

in respect of the taxable profit (tax loss) for a period
Taxable profit (tax loss) is the profit (loss) for a period,
determined in accordance with the rules established by the
taxation authorities, upon which income taxes are payable
(recoverable).
Accounting profit is profit or loss for a period before deducting
tax expense.