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Taxation Administration,Ministry of Finance,R.O.C.Law Source Retrieving System of Taxation Laws and Regulations

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Tax Related Laws & Regulations

Tax Act:
Enforcement Rules of the Income Tax Act
Article 31
Content:
For the amount of income of a profit-seeking enterprise stated in Paragraph 1, Article 24 of the Act, its calculation equation is stated below as an example: 
1. Retail Industry:
(1)Gross Sales Revenue- (Sales Return + Sales Allowance) = Net Sales Revenue 
(2)Beginning Inventory+(Purchase - (Purchase Return +Purchase Allowance)) + 
Purchasing Expenses - Ending Inventory = Costs of Goods Sold
(3)Net Sales Revenue - Costs of Goods Sold = Gross Sales Revenue 
(4)Gross Sales Revenue - (Sales Expenses + Managerial Expenses) = Operating Income
(5)Operating Income+Non-Operating Earnings-Non-Operating Loss = Net Income Amount (i.e. the income amount)
2. Manufacturing Industry:
(1)(Beginning Material + Purchased Material - Ending Material) + Direct Labor + Production Expenses = Production Costs
(2)Beginning Work-in-Process Goods in Stock + Production Costs - Ending Work-in-Process Goods in Stock = Finished Goods Costs
(3)Beginning Finished Goods in Stock + Finished Goods Costs - Ending Finished Goods in Stock = Costs of Goods Sold
(4)Gross Sales Revenue-(Sales Return + Sales Allowance) = Net Sales Revenue 
(5)Net Sales Revenue-Costs of Goods Sold=Gross Profit 
(6)Gross Profit - (Sales Expenses + Managerial Expenses) = Operating Income
(7)Operating Income+Non-Operating Revenue-Non-Operating Loss = Net Income Amount (i.e. the income amount)
3.Other Industries Providing Service or Credit:
(1)Business Revenues - Operating Costs=Business Gross Profit
(2)Business Gross Profit- Managerial or Administrative Expenses = Operating Income
(3)Operating Income + Non-Operating Revenue-Non-Operating Loss = Net Income Amount (i.e. the income amount)
 Update:2018-04-20

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