1. What is the actual return on plan assets for the current year?

 
₱ 370,000
₱ 430,000
₱ 100,000
₱ 400,000
FAIR VALUE OF PLANT ASSET, 12/31 3,900,000
FAIR VALUE OF PLANT ASSET, 01/01 3,500,000
TOTAL 400,000
BENEFITS PAID TO RETIREES 250,000
CONTRIBUTION TO THE PLAN (280,000)
ACTUAL RETURN ON PLANT ASSET 370,000
 DATE

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2. What amount should be reported as lease liability on December 31,2020? 

₱ 4,500,000
₱ 2,912,000 ANNUAL PAYMENT
₱ 4,680,000 MULTIPLIED BY: PV OF 1 AT
₱ 2,800,000 LEASE LIABILITY, 12/31/202

3. What is the initial recognition of the right of use asset? 

₱ 4,700,000 PV OF LEASE PAYMENTS
₱ 2,800,000 COST OF RESTORING
₱ 3,000,000 RIGHT OF USE ASSET - INIT
₱ 3,112,000

4. What is the carrying value of the right of use asset on December 31, 2021
₱ 2,750,000
₱ 2,666,667 RIGHT OF USE ASSET - INIT
₱ 2,488,889 LESS: ACCUMULATED DEP
₱ 2,520,000 RIGHT OF USE ASSET - INIT
DIVIDED BY: LEASE TERM
RIGHT OF USE ASSET - CV
 PAYMENT INTEREST PRINCIPAL
CASH INTEREST EXPENSE LEASE LIABILITY

500,000 252,000 248,000

500,000 229,680 270,320
500,000 205,351 294,649
500,000 178,833 321,167
500,000 149,928 350,072
500,000 118,421 381,579
500,000 84,079 415,921
500,000 46,646 453,354
500,000 5,844 494,156

ANNUAL PAYMENT 500,000

MULTIPLIED BY: PV OF 1 AT 9%, 9 YEARS, ANNUITY 5.6
LEASE LIABILITY, 12/31/2020 2,800,000

PV OF LEASE PAYMENTS 2,800,000

COST OF RESTORING 200,000
RIGHT OF USE ASSET - INITIAL COST 3,000,000

RIGHT OF USE ASSET - INITIAL COST 3,000,000

LESS: ACCUMULATED DEPRECIATION
RIGHT OF USE ASSET - INITIAL COST 3,000,000
DIVIDED BY: LEASE TERM 9 333,333
RIGHT OF USE ASSET - CV 12/31/2021 2,666,667
PRESENT VALUE

2,800,000
2,552,000
2,281,680
1,987,031
1,665,864
1,315,792
934,213
518,292
64,938
(429,217)
5. What amount should be reported as current tax expense for the current year?  TAXABLE INCO
₱ 2,250,000 MULTIPLIED B
₱ 1,050,000 CURRENT TAX
₱ 1,950,000
₱ 1,350,000 PRE-TAX FINA
MULTIPLIED B
6. What amount should be reported as total income tax expense?  TOTAL INCOM
₱ 2,250,000
₱ 1,350,000 CURRENT TAX
₱ 1,050,000 ESTIMATED T
₱ 1,950,000 INCOME TAX

7. What amount of income tax payable should be presented at year end? 

₱ 2,250,000
₱ 1,950,000
₱ 1,350,000
₱ 1,050,000
TAXABLE INCOME 6,500,000.00
MULTIPLIED BY: INCOME TAX RATE 30%
CURRENT TAX EXPENSE 1,950,000.00

PRE-TAX FINANCIAL INCOME 7,500,000.00

MULTIPLIED BY: INCOME TAX RATE 30%
TOTAL INCOME TAX EXPENSE 2,250,000.00

CURRENT TAX EXPENSE 1,950,000.00

ESTIMATED TAX PAYMENT 900,000
INCOME TAX PAYABLE 1,050,000.00
8. What is the total amount of interest revenue will FOUR earn over the term of the lease? 
₱ 139,450
₱ 129,360
₱ 51,600
₱ 75,000

9. At what amount should the lease receivable be initially recognized? 

₱ 278,900
₱ 375,000
₱ 1,617,000
₱ 323,400
EQUIPMENT FAIR VALUE 323,400
DIVIDED BY: PV FACTOR OF 1 AT 8%, 5 YE 4.312
TOTAL 75,000
MULTIPLIED BY: LEASE TERM 5
TOTAL 375,000
EQUIPMENT FAIR VALUE 323,400
INTEREST REVENUE 51,600

EQUIPMENT FAIR VALUE 323,400

DIVIDED BY: PV FACTOR OF 1 AT 8%, 5 YE 4.312
TOTAL 75,000
MULTIPLIED BY: LEASE TERM 5
LEASE RECEIVABLE 375,000
10. How much should be shown in FIVE's 2021 income statement as gross rental income? 
₱ 6,000
₱ 30,000
₱-0-
₱ 60,000
al income? 
 1. How much is to be reported
PV OF LP, 03/31/2021
LESS: ANNUAL PAYMENT
ADJUSTED, PV OF LP 03/3
ADD: INTEREST EXPENSE
ADJUSTED, PV OF LP
MULTIPLIED BY: IMPL
INTEREST EXPENSE
MULTIPLIED BY: PERI
1. How much is to be reported in the statement of financial position as lease LEASE LIABILITY, 12/31/2
liability for the year ended December 31, 2021? 
2. What is the interest expense for the calendar year 2022? (round off 2. What is the interest expens
answer to the nearest WHOLE NUMBER)  INTEREST EXPENSE - 01/
3. How much depreciation expense is to be recorded for the year ended INTEREST EXPENSE
2021? (present answer with 2 DECIMAL PLACES)  MULTIPLIED BY: PERI
INTEREST EXPENSE - 04/
ADJUSTED, PV OF LP
LESS: PRINCIPAL, 03/

CARRYING VALUE, 03
MULTIPLIED BY: IMPL
INTEREST EXPENSE
MULTIPLIED BY: PERI
INTEREST EXPENSE FOR

3. How much depreciation exp

INITIAL COST OF ASSET
DIVIDED BY: USEFUL LIFE
ANNUAL DEPRECIATION
MULTIPLIED BY: PERIOD
DEPRECIATION EXPENSE
How much is to be reported in the statement of financial position as lease liability for the year ended December 31, 20
PV OF LP, 03/31/2021 3,175,500.00
LESS: ANNUAL PAYMENT 375,250.00
ADJUSTED, PV OF LP 03/31/2021 2,800,250.00
ADD: INTEREST EXPENSE FOR 2021
ADJUSTED, PV OF LP 03/31/2021 2,800,250.00
MULTIPLIED BY: IMPLICIT LEASE RATE 12%
INTEREST EXPENSE 03/31/2022 336,030.00
MULTIPLIED BY: PERIOD 3/4 252,022.50
LEASE LIABILITY, 12/31/2021 3,052,272.5

What is the interest expense for the calendar year 2022? (round off answer to the nearest WHOLE NUMBER) 
INTEREST EXPENSE - 01/01/2022 - 03/31/2022
INTEREST EXPENSE 03/31/2022 336,030
MULTIPLIED BY: PERIOD 1/4 84,008
INTEREST EXPENSE - 04/01/2022 - 12/31/2022
ADJUSTED, PV OF LP 03/31/2021 2,800,250
LESS: PRINCIPAL, 03/31/2022
PERIODIC PAYMENT 375,250
LESS: INTEREST EXPENSE 03/31/2022 336,030 39,220
CARRYING VALUE, 03/31/2022 2,761,030
MULTIPLIED BY: IMPLICIT INTEREST RATE 12%
INTEREST EXPENSE 03/31/2023 331,324
MULTIPLIED BY: PERIOD 3/4 248,493
INTEREST EXPENSE FOR 2022 332,500

How much depreciation expense is to be recorded for the year ended 2021? (present answer with 2 DECIMAL PLACES
INITIAL COST OF ASSET 3,175,500.00
DIVIDED BY: USEFUL LIFE 10
ANNUAL DEPRECIATION 317,550.00
MULTIPLIED BY: PERIOD 3/4
DEPRECIATION EXPENSE FOR YEAR ENDED 2021 238,162.50
e year ended December 31, 2021? 
6.328249792
D P I P PV
5.967639767 3/31/2021 3,175,500.00
3/31/2021 375,250.00 375,250.00 2,800,250.00
3/31/2022 375,250.00 336,030.00 39,220.00 2,761,030.00
3/31/2023 375,250.00 331,323.60 43,926.40 2,717,103.60
24 375,250.00 326,052.43 49,197.57 2,667,906.03
25 375,250.00 320,148.72 55,101.28 2,612,804.76
26 375,250.00 313,536.57 61,713.43 2,551,091.33
27 375,250.00 306,130.96 69,119.04 2,481,972.29
st WHOLE NUMBER)  28 375,250.00 297,836.67 77,413.33 2,404,558.96
29 375,250.00 288,547.08 86,702.92 2,317,856.04

swer with 2 DECIMAL PLACES) 

 TOTAL RENT 12/31/2021
LEASE TERM
LESS: FREE RENT MONTHS
REMAINING MONTHS
4. How much should be reported as rent expense in SEVEN's MULTIPLIED BY: MONTHLY R
income statement for the year ended December 31, 2021?  TOTAL RENT
DIVIDED BY: LEASE TERM
AVERAGE MONTHLY RENT
MULTIPLIED BY: MONTHS
ADDITIONAL RENT
SALES
LESS: 2 MILLION
EXCESS
MULTIPLIED BY: ADDITIONA
BONUS, 12/31/2021
BONUS FOR THE LEASE
MULTIPLIED BY: PERIOD
RENT EXPENSE, 12/31/2021
TOTAL RENT 12/31/2021
LEASE TERM 60
LESS: FREE RENT MONTHS 9
REMAINING MONTHS 51
MULTIPLIED BY: MONTHLY RENT 20,000.00
TOTAL RENT 1,020,000.00
DIVIDED BY: LEASE TERM 60.00
AVERAGE MONTHLY RENT 17,000.00
MULTIPLIED BY: MONTHS 8 136,000.00
ADDITIONAL RENT
SALES 2,600,000.00
LESS: 2 MILLION 2,000,000.00
EXCESS 600,000.00
MULTIPLIED BY: ADDITIONAL RENT RATE 5% 30,000.00
BONUS, 12/31/2021
BONUS FOR THE LEASE 144,000.00
MULTIPLIED BY: PERIOD 2/15 19,200.00
RENT EXPENSE, 12/31/2021 185,200.00
 2020 AVERAGE QUARTERLY SA
MULTIPLIED BY: QUARTERS IN
AVERAGE ANNUAL SALARIES
MULTIPLIED BY: PERCENTAGE
ANNUAL RETIREMENT BENEFI

5. Compute for the annual retirement benefit expense for 2020. 2021 AVERAGE QUARTERLY SA
(present answer in whole number)  MULTIPLIED BY: QUARTERS IN
6. Compute for the annual retirement benefit expense for 2021. AVERAGE ANNUAL SALARIES
(present answer in whole number)  MULTIPLIED BY: PERCENTAGE
ANNUAL RETIREMENT BENEFI
2020 AVERAGE QUARTERLY SALARIES 1,275,850
MULTIPLIED BY: QUARTERS IN A YEAR 4
AVERAGE ANNUAL SALARIES 5,103,400
MULTIPLIED BY: PERCENTAGE TO CONTRIBUTE 0
ANNUAL RETIREMENT BENEFIT EXPENSE FOR 2020 382,755

2021 AVERAGE QUARTERLY SALARIES 1,390,675

MULTIPLIED BY: QUARTERS IN A YEAR 4
AVERAGE ANNUAL SALARIES 5,562,700
MULTIPLIED BY: PERCENTAGE TO CONTRIBUTE 0
ANNUAL RETIREMENT BENEFIT EXPENSE FOR 2021 417,203
 7. Compute for the taxable income
PRETAX FINANCIAL INCOME
PERMANENT DIFFERENCES
NON-DEDUCTIBLE EXPENSES
TAX PENALTIES
INSURANCE
LESS: NON-TAXABLE INCOME
DIVIDENDS RECEIVED
FINANCIAL INCOME AFTER PERM
TEMPORARY DIFFERENCES
FUTURE DEDUCTIBLE AMOUN
ESTIMATED DOUBTFUL AC
LITIGATION LOSS
RENT INCOME
LESS: FUTURE TAXABLE AMO
EXCESS TAX DEPRECIATIO

7. Compute for the taxable income 

8. Compute for the deferred tax asset.  TAXABLE INCOME
9. BONUS QUESTION : Compute for the net income after tax
(round off to the nearest whole number) 
FUTURE DEDUCTIBLE AMOUNT
MULTIPLIED BY: INCOME TAX RA
DEFERRED TAX ASSET

PRETAX FINANCIAL INCOME

LESS: TOTAL TAX EXPENSE
NET INCOME AFTER TAX
Compute for the taxable income 
PRETAX FINANCIAL INCOME 8,584,950.00
PERMANENT DIFFERENCES
NON-DEDUCTIBLE EXPENSES
TAX PENALTIES 80,650.00
INSURANCE 175,000.00 255,650.00
LESS: NON-TAXABLE INCOME
DIVIDENDS RECEIVED 348,250.00 (92,600.00)
FINANCIAL INCOME AFTER PERMANENT DIFFERENCES 8,492,350.00
TEMPORARY DIFFERENCES
FUTURE DEDUCTIBLE AMOUNT
ESTIMATED DOUBTFUL ACCOUNTS EXPE 197,745.00
LITIGATION LOSS 275,875.00
RENT INCOME 589,125.00 1,062,745.00
LESS: FUTURE TAXABLE AMOUNT
EXCESS TAX DEPRECIATION
TAX DEPRECIATION 785,900.00
LESS: FINANCIAL DEPRECIATION 572,150.00 213,750.00 848,995.00
TAXABLE INCOME 9,341,345.00

FUTURE DEDUCTIBLE AMOUNT 1,062,745.00

MULTIPLIED BY: INCOME TAX RATE 35%
DEFERRED TAX ASSET 371,961

PRETAX FINANCIAL INCOME 8,584,950

LESS: TOTAL TAX EXPENSE 2,972,323
NET INCOME AFTER TAX 5,612,628

3,269,470.75
74,812.50
371,960.75
2,972,322.50