Problem 1

ABC Quezon Avenue, Inc. is a dealer of trucks and automobiles. ABC distributes annual bonuses to its Vice president for Sales department and three division managers, namely: truck divison, SUV division, and AUV and Sedan Division. The company reported P 12,000,000 profit for year 2019 before bonuses and income tax. Income tax rate is 30%.

How much is the total bonus expense that should be recognized for the vice president and each division manager, if the vice president gets 3% and each division manager gets 1%of profit after bonuses before income taxes?

(1 Point)

P 679,246

P 169,811

P 765,956

P 339,623

Problem 2

Which of the following statements is incorrect?

(1 Point)

- The corporation cannot issue shares more than its authorized number of shares

- The trust fund doctrine provides that subscriptions to the capital stock of a corporation constitute a fund to which creditors have a right to look for the satisfaction of their claims

- New term for the corporation in the revised corporation code will now be considered perpetual

- The holders of ordinary and preference shares elect the corporation's board of directors