Pascua, Lee

COABLK2B

Case 1:

Jaypee has the following income in 2020:

 P10,000 interest income from a non-resident Japanese friend

 P40,000 interest income from Philippine residents

 P500,000 rent income from a commercial complex located in the US which is leased to resident
Filipinos

 P200,000 rent income from a boarding house in Baguio City, Philippines

 P200,000 professional fees rendered to Chinese clients in Hong Kong

 P300,000 salary from a resident corporation

 P100,000 gain from the sale of merchandise imported and sold to Filipino residents

 P50,000 gain on sale of merchandise purchased locally and sold during business travel in Hong
Kong

 P400,000 gain on sale the boarding house located in Baguio City to a non-resident buyer 

Required: Compute the total income earned within the Philippines and outside of the Philippines.
CASE 1 Within Without

P10,000 interest income from a

non-resident Japanese friend
10,000

P40,000 interest income from

Philippine residents
40,000

P500,000 rent income from a

commercial complex located in
the US which is leased to 500,000
resident Filipinos

P200,000 rent income from a

boarding house in Baguio City,
Philippines 200,000

P200,000 professional fees 200,000

rendered to Chinese clients in
Hong Kong

P300,000 salary from a resident 300,000

corporation

P100,000 gain from the sale of 100,000

merchandise imported and sold
to Filipino residents

P50,000 gain on sale of 50,000

merchandise purchased locally
and sold during business travel
in Hong Kong
P400,000 gain on sale the 400,000
boarding house located in
Baguio City to a non-resident
buyer 

TOTAL P1,040,000 P760,000

Case 2:

Joy earns franchise fees from her Hot Burger franchise. She also deals in various properties. Joy realized
the following gains in 2020:

 P500,000 royalty fees from local Hot Burger outlets

 P200,000 royalty fees from foreign Hot Burger outlets

 P100,000 gain from sale of equipment to foreign franchisees

 P200,000 gain from sale of equipment to local franchisees

 P50,000 gain from sale of investment in domestic stocks to foreign investors

 P40,000 gain from sale of investment in foreign stocks to Filipino investors

Required: Compute the total income earned within the Philippines and outside of the Philippines.
CASE 2 Within Without

P500,000 royalty fees from local

Hot Burger outlets
500,000

P200,000 royalty fees from

foreign Hot Burger outlets
200,000

P100,000 gain from sale of

equipment to foreign
100,000
franchisees

P200,000 gain from sale of

equipment to local franchisees
200,000

P50,000 gain from sale of

investment in domestic stocks
to foreign investors 50,000

P40,000 gain from sale of

investment in foreign stocks to
Filipino investors 40,000

TOTAL P750,000 P340,000