Mendoza Fatima Mae CY1 Summer 20 21 Business-Taxation Final-TASK PDF

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Summary

Problem 1 (20 points) Isarog is a common carrier with passenger buses and cargo trucks. For the month of June 2018, it had the following data on gross revenues and receipts (exclusive of taxes): For transporting passengers (receipts) 660, For transporting cargoes (revenues) 440, Actual receipts amou...

Description

Students Name: Mendoza, Fatima Mae

Degree Program: BS-Accountancy

Professors Name: Mrs. Elena Aguila

Mobile Number: 09085005413

Email: [email protected]

Problem 1 (20 points)

Isarog is a common carrier with passenger buses and cargo trucks. For the month of June 2018, it had the following data on gross revenues and receipts (exclusive of taxes): For transporting passengers (receipts)

660,000

For transporting cargoes (revenues)

440,000

Actual receipts amounted to P400,000 For renting out to the MMDA its towing trucks (receipts) 100,000 P20,000 represents revenue from the first quarter and the balance of 80,000 represents receipts from income earned in June

Required: 1. Percentage Tax Due 2. Output VAT Payable

Answer: Gross Receipts (passengers) Common Carrier

P600,000 x 3% P 19,800

Gross Receipts (400,00 + 100,000)

P 500,000 x 12%

Output Tax

P 60,000

Problem 2 (30 points) Compute the OPT for each of the following independent cases: A. JJ, non-vat registered taxpayer, operates a convenience store from which the gross receipts from sales, and payments on purchases from VAT registered suppliers were as follows (net of taxes): Sales of processed food items 280,000 Sales of non-food items 220,000 Purchases of processed food items 100,000 Purchases of non-food items 80,000 Salaried of helpers 48,000 Answers: Gross Receipts – Processed food items

P 280,000

Gross Receipts - Non - food Items

220,000

OPT Under Sec. 116

P500,000 x 3% P 15,000

B. Star Bus Company (a domestic common carrier) has the following data for the first quarter of the current year. Gross receipts, passenger operations 8,000,000 Gross revenue from cargo operations 5,000,000 Expenses, passenger operations 4,750,000 Expenses, cargo operations 2,500,000 Gross receipts – rental of facilities 2,000,000 Additional: 25% of its gross revenue from cargo operations were still outstanding as of the end of the quarter Answer: Gross Receipt – Passenger operations by land

P 8,000,000 x 3%

Common Carriers Tax

P 240,000

C. Fly Away Air Lines (a resident international carrier) has the following data for the current year: Gross receipts, Philippines (passenger operations) 10,000,000 Gross receipts, Philippines (cargo operations) 6,000,000 Gross receipts, Japan (passenger operations) 8,000,000 Gross receipts, Japan (cargo operations) 5,000,000 Expenses, Philippines (passenger operations) 4,000,000 Expenses, Philippines (cargo operations) 2,000,000 Expenses, Japan (passenger operations) 4,500,000 Expenses, Japan (cargo operations) 1,250,000 Answers: Gross Receipts, Philippines – Cargo Operations Common Carrier Tax

P600,000 x 3% P 180,000

D. Dreamland Company, a closely held corporation, has an authorized capital of P1,000,000 with par value of 10 per share. As of December 31, 2017, outstanding shares amounted to P250,000. The Company offered its shares to the public for the first time on June 30, 2018. 10,000 were sold at initial public offering for P150,000. On October 2018, Leonar, existing shareholder, sold his 1,000 shares for P20,000. Answers: 1. P 250,000 / 10per Share = 25,000 Shares 25,0000 Shares / 10,000 shares = 35,000 Shares 10,0000 / 35,000 = 28.57% >> IPO rate = 2% Primary offering (P 150,000 x 2%) P 3,000 2. Total price or shares

P 20,000 x 60% x 1$

Stock transaction tax

P120

E. Mr. Talion operates a cockpit. Results of operations for 2018 were provided as follows: Gross receipts: Cockpit operations 4,000,000 Restaurant operations 1,850,000 Purchases:

Supplies for cockpit operations (net of vat) 750,000 Supplies for restaurant operations (invoice amount) 224,000 Answers Gross Receipts – Cockpit Operations Gross Receipts – Restaurants Operations Total Amusement Tax

P4,000,000 1,850,000 P5,850,000 x 18% P 1,053,000

F. Meralco is a holder of franchise to sell electricity. It also leases its first-class auditorium and theatre. In a particular month, its gross receipts from sale of electricity amounted to P10,000,000. The gross receipts from the lease of its auditorium and theatre amounted to P2,000,000. Answers Gross Receipt – from the lease

P 2,000,000 x 3%

OPT under Sec. 116

P 60,000

Problem 3 (20 points) Prosperous Bank has the following data for the 1st half 2018:

1st Quarter 2nd Quarter

Interest and commission income from lending activities with maturity of 3 years

4,000,000

2,800,000

3,500,000

3,300,000

6,000,000

7,200,000

775,000

825,000

1,200,000

950,000

Interest and commission income from lending activities with maturity of 5 years Interest and commission income from lending activities with maturity of 7 years Other income from rentals of facilities and other Assets Income from financial leasing (remaining maturity is more than 5 years)

Dividends and equity shares in net income of Subsidiaries

500,000

400,000

Net trading gain (loss)

(150,000)

325,000

Tax rate

% Tax

Required: 1. Gross Receipts Tax for March 31, 2018 2. Gross Receipts Tax for June 30, 2018

Answers Required 1

Interest on short tern loans: Maturity period 3% years Maturity period of 5 years Total

P 4,000,000 3,500,000 P 7,500,000

5%

P 375,000

Interest on long term More than 5 years maturity More than 5 years maturity Total

P 6,000,000 1,200,000 P 7,200,000

1%

P 72,000

Dividends

P 500,000

0%

0

Other item of gross income: Rental Income P 775,000 Gross Receipts Tax (1st quarter)

7%

P 54,250 P 501,250

Tax rate

% Tax

5%

P 305,000

Required 2

Interest on short term loans: Maturity period 3% years Maturity period of 5 years Total

P 2,800,000 3,300,000 P 6,100,000

Interest on long term More than 5 years maturity More than 5 years maturity Total

P 7,200,000 950,000 P 8,150,000

1%

P 81,500

Dividends

P 400,000

0%

0

Other item of gross income: Rental Income P 825,000 Net trading gain P175,000 Gross Receipts Tax (2st quarter)

7% 7%

P 57,750 P12,250 P 456,500...