private company located at davao city, has a following information: gross receipt/sales, phils3,480,000…

private company located at davao city, has a following information: gross receipt/sales, phils3,480,000 gross receipt/sales, taiwan 645,000 cost of sales/service, phils 1,434,000 cost of sales/service, taiwan 212,000 operating expense, phils 799,000 operating expense, taiwan 87,000 a. if the company is an individual who is a resident citizen chooses osd, what is the tax due? (5points) b. if the company is an individual who is a non - resident citizen chooses 8% preferential tax rate at the beginning of the year, what is the tax due? (5points) c. if the company is a corporation who is a domestic corporation chooses osd, what is the tax due? (5points) d. if the company is a corporation who is a resident foreign corporation chooses itemized deduction, what is the tax due? (5points)

private company located at davao city, has a following information: gross receipt/sales, phils3,480,000 gross receipt/sales, taiwan 645,000 cost of sales/service, phils 1,434,000 cost of sales/service, taiwan 212,000 operating expense, phils 799,000 operating expense, taiwan 87,000 a. if the company is an individual who is a resident citizen chooses osd, what is the tax due? (5points) b. if the company is an individual who is a non - resident citizen chooses 8% preferential tax rate at the beginning of the year, what is the tax due? (5points) c. if the company is a corporation who is a domestic corporation chooses osd, what is the tax due? (5points) d. if the company is a corporation who is a resident foreign corporation chooses itemized deduction, what is the tax due? (5points)

Answer

Explanation:

Step1: Calculate total gross receipts

Total gross receipts = Gross Receipt/Sales, Phils + Gross Receipt/Sales, Taiwan = 3480000 + 645000 = 4125000

Step2: Calculate total cost of sales/service

Total cost of sales/service = Cost of Sales/Service, Phils+Cost of Sales/Service, Taiwan = 1434000 + 212000 = 1646000

Step3: Calculate total operating expense

Total operating expense = Operating Expense, Phils+Operating Expense, Taiwan = 799000 + 87000 = 886000

Step4: a. For resident - citizen individual with OSD

OSD rate for individuals is 40% of gross income. Taxable income = Gross income×(1 - 0.4). Tax due = Taxable income×tax rate. Assuming a flat - rate income tax for simplicity (not given in full details in the problem, but common in basic tax calculations). First, Taxable income = 4125000×(1 - 0.4)=2475000. If we assume a 30% tax rate for higher - income individuals (common in some tax systems), Tax due = 2475000×0.3 = 742500

Step5: b. For non - resident citizen with 8% preferential tax rate

Tax due = Gross income×8% = 4125000×0.08 = 330000

Step6: c. For domestic corporation with OSD

OSD rate for corporations is 40% of gross income. Taxable income = Gross income×(1 - 0.4). Assuming a 30% corporate income tax rate. Taxable income = 4125000×(1 - 0.4)=2475000. Tax due = 2475000×0.3 = 742500

Step7: d. For resident foreign corporation with itemized deduction

Taxable income = Gross income - Cost of sales/service - Operating expense = 4125000-1646000 - 886000 = 1593000. Assuming a 30% corporate income tax rate, Tax due = 1593000×0.3 = 477900

Answer:

a. 742500 b. 330000 c. 742500 d. 477900