Jasco Company is in the first year of operations. The entity reported pretax income of P4,000,000 and recorded the

following items:

Premium on life insurance of key officer 100,000

Depreciation on tax return in excess of book depreciation 120,000

Interest on exempt government bonds 53,000

Warranty expense 40,000

Actual warranty repairs 32,000

Bad debt expense 14,000

Beginning balance in allowance for uncollectible accounts 0

Ending balance in allowance for uncollectible accounts 8,000

Rent received in advance that will be recognized

evenly over the next three years 240,000

1. What is the taxable income for the current year?

A. 4,047,000 C. 4,103,000

B. 4,083,000 D. 4,183,000