Mekeni Company provided the following information at year-end:

Carrying amount Tax base

Accounts receivable 1,500,000 1,750,000

Motor vehicle 1,650,000 1,250,000

Provision for warranty 120,000 0

Deposit received in advance 150,000 0

The depreciation rates for accounting and taxation are 15% and 25%, respectively. The deposits are taxable when received and warranty

costs are deductible when paid.

An allowance for doubtful debts of P250,000 has been raised against accounts receivable for accounting purposes but such debt are

deductible only when written off as uncollectible. The tax rate is 30%.

1. What amount should be reported as deferred tax liability?

A. 36,000 B. 81,000 C. 120,000 D. 156,000

2. What amount should be reported as deferred tax asset?

A. 36,000 B. 81,000 C. 120,000 D. 156,000