INDIVIDUAL INCOME TAX

The following is the trial balance of BALAYAN MEDICAL CLINIC, a sole proprietorship, for
the year ended December 31, 2020:

Debit Credit
Petty Cash Fund 10,000.00
Bank of the Philippine Islands 868,829.00
Accounts Receivable 411,900.00
Allownce for Doubtful Accounts 20,595.00
Unused Laboratory Supplies 87,500.00
Unused Office Supplies 15,500.00
Laboratory and Medical Equipment 1,000,000.00
Accumulated Depreciation- Laboratory and Medical Equipment 90,000.00
Office Furniture and Equipment 500,000.00
Acumulated Depreciation-Furniture and Office Equipment 100,000.00
Creditable Withholding Tax 63,456.60
Accounts Payable 208,568.60
SSS/PHIC/HDMF/ECC Premium Payable 16,660.00
Owner's, Capital 1,930,000.00
Owner's, Drawing 20,000.00
Laboratory and Medical Income 3,172,830.00
Salary Expense 960,000.00
Laboratory and Medical Supplies 780,385.00
Depreciation Expense 190,000.00
Rent Expense 180,000.00
Communication, Light and Water 156,578.00
SSS/PHIC/HDMF/ECC Contributions 72,248.00
Taxes and Licenses 68,092.00
Income Tax Expense 37,662.00
Insurance Expense 37,500.00
Office Supplies 20,445.00
Doubtful Accounts Expense 20,595.00
Professional Fee 18,000.00
Transportation Expenses 14,350.00
Misellaneous Expenses 5,613.00
5,538,653.60 5,538,653.60

Requirement: Prepare an income tax return (BIR Form 1701) for the taxable year ended
December 31, 2020
1) You are the owner of the proprietorship.
2) You have no other source of income in 2020
3) The doubtful accounts expense was computed under the allowance
method of accounting for bad debts. There was no writeoff in 2020.
4) There income tax expense represents previous quarters' tax payments.
5) The breakdown of creditable withholding tax are as folows:
1st to 3rd quarter - P49,813.43
4th quarter - P13,643.17
6) The income tax return was filed and paid in full on April 15, 2021.
 CORPORATE INCOME TAX

The following is the trial balance of LUCKY GOLDEN TRADING CORPORATION, a

domestic corporation, for the year ended December 31, 2019:

Debit Credit
Petty Cash Fund 15,000.00
Cash in Banks 910,289.68
Accounts Receivable 2,682,227.56
Allownce for Doubtful Accounts 205,950.00
Merchadise Inventory, January 1, 2019 943,979.23
Creditable Withholding tax 110,494.33
Other Current Assets 249,337.73
Long-term Bank Deposits 2,225,980.63
Land 2,200,000.00
Building 807,595.89
Transportation Equipment 440,000.00
Furniture nd Office Equipment 403,336.43
Acumulated Depreciation-Furniture and Office Equipment 652,010.72
Loan Payable-Long-term 551,236.04
Accounts Payable 331,505.31
SSS/PHIC/HDMF/ECC Premium Payable 5,840.00
Other Current Liabilities 9,174.43
Ordinary Shares 3,400,000.00
Share Premium 1,107,140.58
Retained Earnings 3,939,826.54
Sales 11,049,433.42
Interest Income 14,737.31
Sales Returns and Allowances 44,197.73
Sales Discounts 508,273.94
Purchases 8,361,256.48
Salary Expense 612,400.00
Directors' Fee 103,666.60
Delivery Expense 80,993.00
Income Tax Expense 80,358.00
Interest Expense 74,367.03
Communication, Light and Water 73,578.67
Doubtful Accounts Expense 55,247.16
Meeting Expenses 52,600.00
Depreciation Expense 52,391.24
SSS/PHIC/HDMF/ECC Contributions 42,873.30
Professional Fee 35,713.25
Insurance Expense 28,164.12
Transportation Expenses 24,720.87
Taxes and Licenses 21,059.06
Office Supplies 13,002.25
Misellaneous Expenses 13,750.17
21,266,854.35 21,266,854.35

Requirement: Prepare an income tax return (BIR Form 1702-RT) for the taxable year ended
December 31, 2019 under the following assumptions:
1) You are the president of the corporation.
2) The merchandise inventory on December 31, 2019 amounted to P517,995.81.
3) The interest income was earned from bank deposit net of 20% final tax.
4) The doubtful accounts expense was computed under the allowance
method of accounting for bad debts. There was no writeoff in 2019.
5) The income tax expense represents previous quarters' tax payments.
6) The breakdown of creditable withholding tax are as folows:
1st to 3rd quarter - P75,522.87
4th quarter - P34,971.46
7) The income tax return was filed and paid in full on April 15, 2020.
5.81.