APRIL 2019

DAILY MACHINE WORKS

PAYROLL SHEET
FOR THE PERIOD April 1-30 2014

NAME GROSS EARNINGS WITHHOLDING TAX SSS Philhealth HDMF

1 Waldo Po 24,000.00 381.40 800.00 360.00 100.00
2 Baldo Fiero 24,500.00 479.90 800.00 367.50 100.00
3 Claudio Reyes 18,500.00 - 740.00 277.50 100.00
4 Nando Pura 20,500.00 - 800.00 307.50 100.00
5 Peter Garcia 15,000.00 - 600.00 225.00 100.00
102,500.00 861.30 3,740.00 1,537.50 500.00

Note: Two points per journal entry.

April 30 Payroll 102,500.00

Withholding taxes payable 861.30
SSS & EC premiums payable 3,740.00
Philhealth premiums payable 1,537.50
HDMF premiums payable 500.00
Cash in bank 95,861.20

SSS & EC premiums expense 2,664.70

Philhealth premiums expense 462.50
HDMF premiums expense 500.00
SSS & EC premiums payable 2,664.70
Philhealth premiums payable 462.50
HDMF premiums payable 500.00

SSS & EC premiums payable 6,404.70

Philhealth premiums payable 2,000.00
HDMF premiums payable 1,000.00
Withholding taxes payable 861.30
Cash in bank 10,266.00
 DAILY MACHINE WORKS
EMPLOYER'S CONTRIBUTION
FOR THE PERIOD April 1 - 30, 2014

Net Earnings Name SS EC PH HDMF

22,358.60 2pts Waldo Po 1,600.00 30.00 360.00 100.00
22,752.60 2pts Baldo Fiero 1,600.00 30.00 367.50 100.00
17,382.50 2pts Claudio Reyes 1,480.00 30.00 277.50 100.00
19,292.50 2pts Nando Pura 1,600.00 30.00 307.50 100.00
14,075.00 2pts Peter Garcia 1,200.00 30.00 225.00 100.00
95,861.20 2,614.70 50.00 462.50 500.00
2pts 2pts 2pts 2pts

1. Waldo Po 2. Baldo Fiero 3. Claudio Reye 4. Peter Garcia

22,740.00 23,232.50 17,382.50 19,292.50
20,833.00 20,833.00 20,833.00 20,833.00
1,907.00 2,399.50 (3,450.50) (1,540.50)
0.20 0.20 - -
381.40 479.90 - -
- - - -
WTP 381.40 479.90 - -
5. Married
14,075.00
20,833.00
(6,758.00)
-
-
-
-
1. De minimis–rice subsidy (P2,000 x 12 months)
De minimis–clothing
Nontaxable 13th month pay P
Excess amount – clothing (P10,000 – P6,000)
SSS premium contributions
Pag-ibig premium contributions
Philhealth premium contribution
Total nontaxable compensation

2. Gross basic compensation income

Honorarium
Total
Less: SSS premium contributions P
Pag-ibig premium contributions
Philhealth premium contribution
Taxable compensation subject to normal tax

3. Within Without
Salaries expense P 300,000 P
Depreciation expense 100,000
Interest expense
P200,000 – [(P240,000/80%) x 33%] 101,000
Business taxes 240,000
Rent expenses 500,000
Traveling and communication 100,000
Itemized before contributions P 1,341,000 P
Add: Charitable contributions
(P5,000,000 – P1,400,000 – P2,701,000) x 10%
Total itemized deductions

4. Taxable compensation (see 2)

Net business income (P5,000,000–P1,400,000–P2,790,900)
Net taxable income per ITR

Gross sales 2,000,000

COS 600,000
AD 1,341,000
59,000

5. Withholding taxes on wages

Income tax on business within
 Income tax on business without
Limit: (P3M – P800k – P1,360k)
= (P840,000/P1,429,100) x P318,730
Total income tax credits per ITR

6. Tax on P800,000
Tax on excess (P1,429,100 – P800,000) x 30%
Income tax due
Less: Total income tax credits (see 5)
Income tax still due and payable (refundable)

7. Final tax on fringe benefits (P204,000/65%) x 35%

Final tax on interest income (P240,000/80%) x 20%
Final tax on dividend income (P90,000/90% x 10%)
Total final taxes
 P 24,000
6,000
50,000
4,000 54,000
6,000
5,000
9,000
P 104,000 2pts

P 520,000
120,000
P 640,000
6,000
5,000
9,000 20,000
P 620,000 2pts

Without Total
400,000 P 700,000
100,000 200,000
-
101,000
300,000 540,000
400,000 900,000
160,000 260,000
1,360,000 P 2,701,000

89,900
P 2,790,900 2pts

P 620,000
809,100
P 1,429,100 2pts

3,000,000
800,000
1,360,000
840,000

P 100,000
60,595
 187,343.92
P 347,939 2pts

P 130,000
188,730
P 318,730
347,939
P (29,209) 2pts

P 109,846
60,000
10,000
P 179,846 2pts
 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
(8% Rate) (8% Rate) (8% Rate)
Total Sales P 400,000 P 600,000 P 2,000,000 P 2,700,000
Less: Cost of Sales 300,000 350,000 700,000 900,000
Gross Income P 100,000 P 250,000 P 1,300,000 P 1,800,000
Less: Operating Expenses 60,000 100,000 500,000 700,000
Taxable Income P 40,000 P 150,000 P 800,000 P 1,100,000
Total Sales P 5,700,000.00
Less: Cost of Sales 2,250,000.00
Gross Income P 3,450,000.00
Less: Operating Expenses 1,360,000.00
TAXABLE INCOME P 2,090,000.00 2pts

INCOME TAX DUE:

Tax Due under Graduated Rates
Basic Tax - on P2,000,000 P 490,000.00
Additional tax (P90,000 x 32%) 28,800.00
Total income tax due P 518,800.00 2pts
Less: 8% income tax previously paid (Q1 to Q3)* 220,000.00
Annual income tax payable P 298,800.00 2pts

* (P400,000 + P600,000 + P2,000,000 - P250,000) x 8%

1. Net income per books P 153,000
Add: Nondeductible expenses
Provision for bad debts P 4,250
Interest on money borrowed to buy government bonds 255 4,505
Total P 157,505
Less: Non-taxable income
Intercompany dividend P 8,500
Income subject to final tax
Interest on government bonds 7,395 15,895
Taxable income P 141,610

2. Minimum corporate income tax (P382,500 x 2%) P 7,650

3. Normal income tax (P141,610 x 30%) P 42,483

4. Normal income tax - higher than MCIT P 42,483

Less: Quarterly income tax paid 24,225
Income tax still due P 18,258
(2pts)

(2pts)

(2pts)

(2pts)
 Related Unrelated Total
Gross income P 300,000 P 200,000 P 500,000
Deductions 100,000 100,000 200,000
Taxable income P 200,000 P 100,000 P 300,000

1. Regular domestic corporation

Gross income P 500,000
Deductions 200,000
Taxable income P 300,000
Multiply by corporate tax rate 30%
Income tax due P 90,000 (2pts)

2. Government school Exempt (2pts)

3. Exempt nonprofit corporation

Gross income P 200,000
Deductions 100,000
Taxable income P 100,000
Multiply by corporate tax rate 30%
Income tax due P 30,000 (2pts)

4. Proprietary education institution/nonprofit hospital

Gross income P 500,000
Deductions 200,000
Taxable income P 300,000
Multiply by corporate tax rate 10%
Income tax due P 30,000 (2pts)
1.       Regular domestic corporation
2.       Government school
3.       Non-profit corporation
4.       Proprietary educational institution or non-profit hospital
Exempt non-profit corporation
Sale of services, GPP P 2,450,000
Cost of services, GPP 720,000
Itemized deductions, GPP 580,000

Partner Gorio Partner Nacario

Travelling expenses (not liquidated by the GPP) P 45,000 P
Representation expenses (personal credit card of partner used) 52,500
Cost of car, to be depreciated over 5 years
(used in practice, registered under the Partner) 850,000
Interest on bank deposits 5,000
Salaries from the GPP 240,000
Book royalties 160,000
Gross receipts from business (not the GPP) 450,000
Cost of sales - business 230,000
Itemized deductions - business 145,000
 GPP
OSD
Sale of Services ###
Less: Cost of Services ###
Gross Income Less: Deductions 1,730,000
40% Optional Standard Deduction or
40% 692,000
Itemized Deductions -
Partner Nacario Distributable Net Income ###
35,000
63,000
Share of Partner Gorio 60% 622,800
900,000 Share of Partner Nacario 40% ###
16,000
180,000
Partner Gorio
OSD
Share of Each Partner in the GPP (60:40) 622,800
Less: Additional Itemized Deductions- (2pts)
Traveling Expenses -
Representation Expenses -
Depreciation of Car -
Net Share of Each Partner in the GPP 622,800
Add: Other Taxable Income
From Business 270,000
Salaries from the GPP 240,000
Taxable Income 1,132,800
(2pts)
 GPP
Itemized
2,450,000
720,000
1,730,000

-
580,000
1,150,000

690,000
###

Partner Nacario Partner Gorio Partner Nacario

OSD Itemized Itemized
415,200 690,000 460,000
(2pts) (2pts) (2pts)
- 45,000 35,000
- 52,500 63,000
- 170,000 180,000
415,200 422,500 182,000

- 75,000 -
180,000 240,000 180,000
595,200 737,500 362,000
(2pts) (2pts) (2pts)
 Taxi Units Actual Minimum Higher
1 15,000 3,600 15,000
2 9,000 3,600 9,000
3 12,000 3,600 12,000
4 8,000 3,600 8,000
5 20,000 3,600 20,000
Total amount = higher amount 64,000
Multiplied by percentage tax 3%
Percentage tax 1,920 (3pts)

Note: The higher of the aggregate /total amount of the actual gross
receipts or minimum amount is subject to other percentage tax.
 Quarterly Monthly
Jeepney for hire:
Manila and other cities 2,400.00 800.00
Provincial 1,200.00 400.00

Taxis:
Manila and other cities 3,600.00 1,200.00
Provincial 2,400.00 800.00

Public utility bus:

Not exceeding 30 passengers 3,600.00 1,200.00
More than 30 but not 50 passengers 6,000.00 2,000.00
More than 50 passengers 7,200.00 2,400.00

Car for hire:

With chauffeur 3,000.00 1,000.00
Without chauffeur 1,800.00 600.00
Actual gross receipts from business operations P 7,000,000
First quarter (P3,000,000 + P4,000,000) 12%
Multiplied by applicable business tax rate P 840,000 (3pts)
Franchise tax due - first quarter

Note: During the taxable year, its business gross receipts has
exceed P10,000,000; hence, subject to VAT.
Income tax expense P 600,000
Input VAT on purchases of goods sold 240,000
Sales returns 20,000
Sales discounts due to prompt payments 45,000
Gain on sale of capital assets - subjected to normal tax 150,000
Sale of obsolete inventory 10,000
Operating expense before taxes 1,000,000
Community tax 5,000
Presumptive input VAT 60,000
Ending inventory 400,000

Net income (P600,000/30%) P 2,000,000

Less: Gain on sale of capital asset 150,000
Net operating income P 1,850,000
Add: Cost of sales (P240,000/12%) – P400,000 P 1,600,000.00
Sales discounts due to prompt payments 45,000
Operating expenses before taxes 1,000,000
Community tax 5,000 2,650,000
Sales subject to VAT P 4,500,000

Output VAT (P4,500,000 x 12%) P 540,000

Less: Input VAT from purchases P 240,000
Presumptive input VAT 60,000 300,000
Net VAT payable P 240,000 (3pts)
Sale of real properties, excluding VAT Number of units sold Sales price per unit
Commercial lot 10 P 1,000,000
Residential lot 10 1,500,000
Residential house and lot 10 2,500,000

Lease of real properties, excluding VAT Number of units rented rent per unit/month
Commercial lot 10 P 30,000
Residential lot 5 20,000
1. SMDC’s total business tax due would be:

Net VAT payable

Output VAT – sale of commercial lot (P1,000,000 x 10) x 12%
Less: Input VAT (P1,400,000 x 20%)

Output VAT – rent of commercial space (P30,000 x 10 x 12) x 12%

rent of residential houses (P20,000 x 5 x 12) x 12%
Less: Input VAT (P300,000 x 75%)
Total business tax due

2. SMDC’s income tax due would be:

Gross sales:
Commercial lot (P1M x 10)
Residential lot (P1.5M x 10)
Residential house and lot (P2.5 x 10)
Gross receipts from lease of:
Commercial space (P30k x 10 x 12)
Residential houses (P20k x 5 x 12)
Total
Less: Cost of sales (P50M x 60%)
Input VAT traced to sale of:
Residential lot (P1.4M x 30%)
Residential house and lot (P1.4M x 50%)
Input VAT traced to lease of:
Residential houses (P300k x 25%)
Gross income
Less: Itemized deductions
Net taxable income
Multiplied by corporate tax rate
Income tax due

Notes:
1. Computation of percent of receipts

Commercial space (P30k x 10 x 12)

Residential houses (P20k x 5 x 12)
Total sales

2. Allocation of input VAT on gross receipts

Commercial lot
Residential house and lot
Total sales
Notes:
1. Computation of percent of sales

Commercial lot (P1M x 10)

Residential lot (P1.5M x 10)
Residential house and lot (P2.5M x 10)
Total sales

2. Allocation of input VAT on sales

Commercial lot
Residential lot
Residential house and lot
Total sales
 P 1,200,000
### P 920,000

P 432,000
5 x 12) x 12% ###
### 351,000
P 1,271,000 (3pts)

P 10,000,000
15,000,000
25,000,000 P 50,000,000

P 3,600,000
1,200,000 4,800,000
P 54,800,000
P 30,000,000

420,000
700,000

75,000 31,195,000
P 23,605,000
3,569,000
P 20,036,000
30%
P 6,010,800 (3pts)

Amount Percent
P 3,600,000 75%
1,200,000 25%
P 4,800,000 100%

Amount Percent
P 225,000 75%
75,000 25%
P 300,000 100%
 Amount Percent
P 10,000,000 20%
15,000,000 30%
25,000,000 50%
P 50,000,000 100%

Amount Percent
P 280,000 20%
420,000 30%
700,000 50%
P 1,400,000 100%
Gross sales/receipts for the month (VAT taxable) P 750,000
Multiplied by VAT rate 12%
Output VAT P 90,000
Less Input taxes:
Goods (P392,000/9.333) x 675/750 P 37,800
Service (P84,000/9.333) x 675/750 8,100
Standard input VAT on sales to government (P75,000 x 7%) 5,250 51,150
VAT payable before final VAT P 38,850
Less: Final withholding VAT (P75,000 x 5%) 3,750
Net VAT payable P 35,100 (3pts)

Notes:
1. Composition of sales:
Cash sales to VAT persons P 450,000
Cash sales to Non-VAT persons 50,000
Credit sales to VAT persons 200,000
Gross sales P 700,000
Less: Sales returns P 20,000
Sales dicounts 5,000 25,000
VAT taxable sales - subject to VAT P 675,000
Add: Sales to the government - subject to final VAT 75,000
Total sales P 750,000

2. All sales, whether sold to VAT or non-VAT person, cash and on credit are included.

3. Sales return and discounts were deducted to arrive at the amount of net sales. In this
particular case, the sales discounts is deductible to determine the taxable based because the
it does not depend on the happening of future event and its related total sales are recorded.

4. VAT on expenses that are not related in the conduct of business is not allowed as creditable
Input VAT.

5. Sale to government unit is subject to final VAT withholding tax. (Sec. 4.114-2, R.R. 14-2005
Cash sales P 1,000,000
Sales on account 300,000
Installment sales - collection (P500,000 x 20%) 100,000
Transactions deemed sale:
Owner's personal usage (P50,000 x 70%) 35,000
Consigned goods (P100,000 x 70%) 70,000
Total sales P 1,505,000
Multiplied by VAT rate 12%
Output VAT P 180,600
Less: Input VAT from purchases P 48,000
Input VAT credit from previous month 36,000
Input VAT from imported machines used in business
(P200,000 x 150% x 12%) 36,000 120,000
Net VAT payable P 60,600 (3pts)

Note: The transactions deemed sale may be reduced by 30%. (R.A. 9337)
 DATE PARTICULARS F DEBIT CREDIT

a. Inventory, beginning 336,000

Cash 336,000

Inventory, beginning 200,000

Cash 200,000

b. Purchases 560,000
Cash 560,000

Purchases 300,000
Cash 300,000

c. Cash 56,000
Purchase returns 56,000

Cash 20,000
Purchase returns 20,000

d. Cash 1,500,000
Sales 1,500,000

e. Sales returns 150,000

Cash 150,000

f. Business tax expense (P1,350,000 x 3%) 40,500

Business tax payable 40,500

Business tax payable 40,500

Cash 40,500
DATE PARTICULARS F DEBIT CREDIT