Dowell Company reported the following carrying amount of assets and liabilities at year-end:

Property 10,000,000

Plant and equipment 5,000,000

Inventory 4,000,000

Trade receivables 3,000,000

Trade payables 6,000,000

Cash 2,000,000

The value for tax purposes for property and for plant and equipment was P7,000,000 and P4,000,000, respectively. The entity has made

a provision for inventory obsolescence of P2,000,000 which is not allowable for tax purposes. Further, an impairment loss against trade

receivables of P1,000,000 has been made. This charge will not be allowed in the current year for tax purposes. The tax rate is 30%.

1. What amount should be reported as (1) deferred tax liability and (2) deferred tax asset at year-end?

A. (1) 300,000; (2) 0 B. (1) 2,700,000; (2) 0

C. (1) 1,200,000; (2) 900,000 D. (1) 3,600,000 ; (2) 900,000