GHI Company expects to earn P10,000 pre-tax profit in each of the 1ª and 2nd quarters of the year and P15,000 pre-tax profit in each of the last two quarters. The tax rate as of the beginning of the year is 20%. However, following a newly enacted tax legislation, the tax rate will be increased to 30% which shall take effect beginning on the last quarter of the year. Actual earnings match expectations. Compute for income tax expense for the 2nd quarter of the year.

GHI Company expects to earn P10,000 pre-tax profit in each of the 1ª and 2nd quarters of the year and P15,000 pre-tax profit in each of the last two quarters. The tax rate as of the beginning of the year is 20%. However, following a newly enacted tax legislation, the tax rate will be increased to 30% which shall take effect beginning on the last quarter of the year. Actual earnings match expectations. Compute for income tax expense for the 2nd quarter of the year.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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