HO #3 – Co-Ownership & Joint Venture

Problem 1

1. Income tax due of the co-ownership

2. Taxable income of co-owners A and B

Theory 1

Theory 2
Problem 2

• Scenario 1: If the JV was entered into solely to construct an expressway north

and south of Manila and collect toll from users.

• Scenario 2: If the JV was entered into solely to engage in petroleum operations

pursuant to an operating or consortium agreement under a service contract with
the Government.

• Scenario 3: If A Co. and B Co. are transportation companies and they entered a
JV wherein A Co. will transport units south of Manila and B Co. will transport units
north of Manila and that the JV has remitted a total of P1,500,000 quarterly tax
payments.

Problem 3

1. Determine the income tax liability of the joint venture, XY Inc.

2. Determine income tax liability before tax credits of X Builders

3. Assume instead that X and Y are both engaged in the transportation business,
determine the income tax liability of the joint venture
Theory 3