Name: Macalalad, Rhona Mae M. Date: Nov.

17, 2022
Section: BSA 3101

ACTIVITY
Tax 301 – Income Taxation
Income Taxes for Corporations

Directions: Present your answers and solutions in a document in PDF format. Highlight or encircle your final
answer. Upload in the Google Classroom on or before the set deadline.

Problem 1 (8points) The Mounted Corporation records show:

Excess
Normal Excess Withholding
Income Taxes MCIT Prior Tax Prior
Quarter Tax MCIT Withheld Year Year
First P 100,000 P 80,000 P 20,000 P 30,000 P 10,000
Second 120,000 250,000 30,000
Third 250,000 100,000 40,000
Fourth 200,000 100,000 35,000

Required:
1. The income tax due and payable for first quarter is
2. The income tax due and payable for second quarter is
3. The income tax due and payable for third quarter is
4. The income tax due and payable for fourth quarter is

ANSWER:

1st Quarter 2nd Quarter 3rd Quarter Annual

Normal Income Tax 100,000.00 220,000.00 470,000.00 670,000.00
MCIT 80,000.00 330,000.00 430,000.00 530,000.00
Income Tax Due (whichever is higher) 100,000.00 330,000.00 470,000.00 670,000.00
Less: Tax Credits
Prior Year MCIT 30,000.00 30,000.00 30,000.00
Prior Year excess WTax 10,000.00 10,000.00 10,000.00 10,000.00
Taxes Withheld - 1st quarter 20,000.00 20,000.00 20,000.00 20,000.00
Taxes Withheld - 2nd quarter 30,000.00 30,000.00 30,000.00
Taxes Withheld - 3rd quarter 40,000.00 40,000.00
Taxes Withheld - 4th quarter 35,000.00
Quarterly Tax Paid - 1st quarter 40,000.00 40,000.00 40,000.00
Quarterly Tax Paid - 2nd quarter 230,000.00 230,000.00
Quarterly Tax Paid - 3rd quarter 70,000.00
Total Tax Credits 60,000.00 100,000.00 400,000.00 505,000.00
Income tax still due 40,000.00 230,000.00 70,000.00 165,000.00
Problem 2 (10points) Flat-Screen Inc. a domestic corporation, started its operations last 2005. Its records of
2022 operations show:
Gross Sales P 8,876,400
Interest Income 35,162
Dividends from TUBE Inc (domestic corp) 17,900
Royalties earned 2,017,000
Gross Selling Price of Real Property sold by Flat-Screen 3,500,000
Sales Discount 150,000
Cost of Sales 3,450,865
Other Income 2,150,070
Operating Expenses 6,827,700

Other information: Interest income earned is from deposits on Metrobank – Cubao Branch. The Fair Market Value
of the real property which is situated at Pateros, Manila, is amounting to P6,301,200. The sale of real property
resulted to capital gains of P13,459.80. Other Income is derived from sources which are taxable but not subject
to final taxes. Operating Expenses consist of Selling and Administrative Expenses.

Other Information about Income taxes: Flat-Screen has paid income taxes of P17,650 for the first quarter,
P12,092 for second quarter and P32,107 for third quarter. The corporation also has unclaimed Creditable
Withholding Taxes for the year 2022 of P56,980. It also has excess of MCIT for year 2017 of P31,151 and
excess MCIT from year 2021 of P42,378.

Required:
1. Gross Income from Operations
2. Total Gross Income
3. Taxable Income
4. Normal Tax for 2022
5. Minimum Corporate Income Tax for 2022
6. Income Tax due for 2022
7. Income Tax still due for 2022
8. Final Taxes on:
a. Interest Income
b. Dividends
c. Sale on Real Property

ANSWER:

Requirement 1-3

Problem 2
Gross Sales 8,876,400.00
Sales Discount 150,000.00
Net Sales 8,726,400.00
Cost of Sales 3,450,865.00
Gross income from operations 5,275,535.00
Other income 2,150,070.00
Total gross income 7,425,605.00
Operating expenses 6,827,700.00
 Taxable income 597,905.00

Requirement 4

Taxable income 597,905.00

RCIT rate 25%
Normal tax for 2022 149,476.25

Requirement 5

Total gross income 7,425,605.00

MCIT Rate 1%
MCIT for 2022 74,256.05

Requirement 6-7

Income tax due for 2022 149,476.25

Less: Tax credits
MCIT Carry over 42,378.00
Creditable Withholding Tax 56,980.00
Tax paid - 1Q 17,650.00
Tax paid - 2Q 12,092.00
Tax paid - 3Q 32,107.00
Total tax credits 161,207.00
Income tax still due for 2022 (11,730.75)
Requirement 8

Final Taxes:
Interest Income (at gross) 43,952.50
Final tax rate 20%

Final tax due 8,790.50

Dividends (not applicable) -

Final tax rate 10%
Final tax due -

Gross selling price of Real

Property 3,500,000.00
Fair market value (whichever is
higher) 6,301,200.00
CGT rate 6%
Capital gains tax 378,072.00

Problem 3 (5points) Bovino Corporation has the following data during the year:

1st qtr 2nd qtr

Normal Income Tax 10,000 12,000
Minimum Corporate Income Tax 8,000 25,000
Taxes withheld during the quarter 2,000 3,000
Excess MCIT prior year 3,000
Excess w/tax prior year 1,000

1. Income tax payable for the 1st quarter

2. Income tax payable for the 2nd quarter
3. Gross Profit for the second quarter
4. Total Normal Taxable Income for the 2 quarters
5. Excess MCIT claimed for the 2nd quarter

ANSWER:

Requirement 1-2

1st Quarter 2nd Quarter

Normal Income Tax 10,000.00 22,000.00
MCIT 8,000.00 33,000.00
Income Tax Due 10,000.00 33,000.00
Less: Tax Credits
 Excess MCIT prior
year 3,000.00 -
Excess with tax for
prior year 1,000.00 1,000.00
Creditable Withholding
Tax (1Q) 2,000.00 2,000.00
Creditable Withholding
Tax (2Q) 3,000.00
Tax Paid – 1st Quarter 4,000.00
Total Tax Credits 6,000.00 10,000.00
Income Tax Payable 4,000.00 23,000.00

Requirement 3

MCIT - 2nd quarter 25,000.00

Divide by: MCIT rate 1%
Gross profit for the second quarter 2,500,000.00

Requirement 4

Total Normal Income Tax (10,000+12,000) 22,000.00

Divide by: RCIT rate 25%
Total normal taxable income for the 2
quarters 88,000.00

Requirement 5

Excess MCIT Claimed for the 2nd quarter = Zero (0)

Problem 4 (5points) Sawada Enterprises, a closely-held domestic corporation, has the following data:

2021: Gross Income 3,400,000

Expenses 3,800,000
2022: Gross Income 3,960,000
Expenses 3,100,000
Royalty 340,000
Dividends Payable 56,000

1. Income Tax payable in 2021

2. NOLCO for 2021
3. Taxable Income for 2022
4. Income Tax Due for 2022
5. Income Tax Payable in 2022

Problem 5 (4points) In the year 2021, the following cumulative data appear in the records of Vongola
Company, a domestic corporation. It is its 2nd year of operations.

1st qtr 2nd qtr 3rd qtr Year

Sales 180,000 405,000 675,000 1,080,000
Dividends from a Resident Corp 1,800 3,600 5,400 7,200
Rent Income 7,200 14,400 21,600 28,.800
Cost of Sales 45,000 108,000 166,500 270,000
Municipal Taxes 4,500 9,000 13,500 18,000
Business Expenses 108,000 234,000 369,000 657,000

1. Income Tax Due at the end of the First Quarter

2. Normal Income Tax for the Second Quarter
3. Normal tax taxable income for the third quarter
4. Income Tax Due at the end of the year