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Problem - The tax return of Francisco Company indicates taxable profit of P15,000,000 on which a tax liability of P5,250,000 has been recognized. Following is a list of items that may be required to determine accounting profit from the amount of taxable profit. Accelerated depreciation for income tax purposes was P2,000,000 and straight line financial depreciation P1,500,000. Insurance premium of P100,000 on an office with Francisco as beneficiary was not included as a deduction in the tax return. Interest on treasury bills was not included in the tax return. During the year, Francisco received P2,500,000 on these investments. What was Francisco Company's accounting profit?
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