Question

Taxpayer is a sole proprietor owner of a merchandising business. He sells an idle lot located in Baguio City at 10% above cost. Records show the cost of P1,000,000. Zonal value per BIR list is P1,200,000 and the value per local assessor's office is P800,000. Compute the capital gains tax: a. P6,000 b. P60,000 c. P72,000 d. Not subject to capital gains tax

Name: taxpayer is a sole proprietor owner of a merchandising business he sells an idle lot located in baguio city at 10 above cost records show the cost of p1oooooo zonal value per bir list is p12 26918
Uploaded: 2022-04-08T10:29:15-08:00
Duration: 3 min 1 s
Channel: Manasvee Singh
Description: taxpayer is a sole proprietor owner of a merchandising business he sells an idle lot located in baguio city at 10 above cost records show the cost of p1oooooo zonal value per bir list is p12 26918

          Taxpayer is a sole proprietor owner of a merchandising business. He sells an idle lot located in Baguio City at 10% above cost. Records show the cost of P1,000,000. Zonal value per BIR list is P1,200,000 and the value per local assessor's office is P800,000. Compute the capital gains tax:
a. P6,000
b. P60,000
c. P72,000
d. Not subject to capital gains tax

Added by Alexander P.

Horngren’s Cost Accounting

Srikant M. Datar, Madhav V. Rajan 16th Edition

Instant Answer

Solved by Expert Manasvee Singh

04/08/2022

Step 1

Since the lot was sold at 10% above its cost and the cost is P1,000,000, the selling price is: Selling Price = P1,000,000 + (10% of P1,000,000) = P1,000,000 + P100,000 = P1,100,000. Show more…

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Taxpayer is a sole proprietor owner of a merchandising business. He sells an idle lot located in Baguio City at 10% above cost. Records show the cost of P1,000,000. Zonal value per BIR list is P1,200,000 and the value per local assessor's office is P800,000. Compute the capital gains tax: a. P6,000 b. P60,000 c. P72,000 d. Not subject to capital gains tax