In the course of your examination, as a revenue officer, of the audited financial statements of AAA Corporation which sells and leases real estate, and by virtue of a Letter of Authority duly issued by the BIR, the income statement of AAA Corporation on its first year of operations shows:

Revenues
Gain on sale of residential lots	P600,000
Bank interest income	32,000
Dividend from Domestic Corporation	8,000
Rental income	2,400,000
Total	P3,040,000
Expenses
Salaries and wages	P500,000
Depreciation	300,000
Entertainment and representation	60,000
Office supplies	80,000
Advertising expense	30,000
Interest expense	100,000
Taxes and licenses	230,000
Total	P1,300,000
Net income before tax	P1,740,000
Less: Income tax expenses	275,000
Net income after income tax	P1,465,000
The income tax due for the computed by AAA shows:
Net income before income tax	P1,740,000
Less:
Bank interest income	(32,000)
Dividend from Domestic Corporation	(8,000)
Gain on sale of lots	(600,000)
Net taxable income	P1,100,000
Corporate income tax rate	25%
Income tax expense	P275,000

During examination, you observed the following:

2. The balance sheet for the taxable year showed deferred rent income of P800,000.
4. The bank interest income is net of 20% final withholding tax.
6. AAA Corporation is a domestic corporation.
8. The gain on sale of residential lots represent gain on sale of two residential lots with selling price of P1,000,000 each.
10. Interest expense includes interest on late payment of tax amounting to P10,000.
12. Entertainment and representation expenses are duly supported by receipts and are business connected.
14. Taxes and licenses in the notes to Financial Statements showed the following:

Documentary stamp tax on sale of the residential lots	P40,000
Surcharges and penalties on late payment of tax	20,000
Withholding tax on the sale of the lots	120,000
Permits and licenses	40,000
Special assessment	10,000

Based on the information above, answer the following:

2. How much should be reflected as net sales and net revenue in the annual income tax returns of AAA Corporation?
4. How much should be the deductible taxes and licenses?