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Multiple-Choice – Problems: Part 1 Sabina Flour Milling (SFM) Corporation imports and mills wheat for the domestic market. During the month, it imported wheat at a total landed cost of P3, 000,000. The same was milled and yielded 2,000 sacks of flour. 1,200 sacks was sold at a price of P2,400 per sa...

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Multiple-Choice – Problems: Part 1 1. Sabina Flour Milling (SFM) Corporation imports and mills wheat for the domestic market. During the month, it imported wheat at a total landed cost of P3, 000,000. The same was milled and yielded 2,000 sacks of flour. 1,200 sacks was sold at a price of P2,400 per sack. What is the advanced VAT to be paid by SFM upon importation of the wheat? a. P 0 b. P 288,000

c. P 360,000 d. P 460,800

e. 2. Sugar Nanny Corporation (SNC) buys sugar cane from farmers and processes them into refined sugar. During a month, SNC made the following purchases: f. g. Purchase of canes sugar P 1,800,000 h. Other supplies, excluding VAT 300,000 i. Other expenses, including VAT 112,000 j. k. A total of 2,000 bags were produced. 1,500 were sold at a price of P1,600 per bag in the same month. l. m. SNC paid the advanced VAT on the production in accordance with the BIR’s prescribed new based price for refines sugar. n. \ o. What is the advanced VAT? a. P 204,000 b. P 216,000

c. P 288,000 d. P 336,000

c. 3. In the immediately preceding problem, what is the total credit against output VAT (including the advanced VAT) for the month? a. P 318,000 c. P 456,000 b. P 324,000 d. P 480,000 4. 5. A VAT-taxpayer had the following data on its VAT obligation at the last quarter of the year: 6. 7. Output VAT on regular sales P 150,000 8. Input VAT on regular sales 120,000 9. Advanced input VAT 70,000 10. Advanced input VAT claimed as tax credit 40,000 11. VAT paid in the prior months 40,000 12. 13. What is the input VAT carry-over for the following quarter?

a. P 0 c. P 50,000 b. P 40,000 d. P 80,000 14. 15. Mr. Esperon, A VAT registered person, had the following transactions during the month: 16. 17. Sales to non-VAT persons, VAT exclusive P 400,000 18. Sales to VAT persons, VAT exclusive 500,000 19. Purchases from VAT persons, VAT exclusive 200,000 20. Purchases from non-VAT persons 100,000 21. 22. Compute the VAT payable. a. P 84,000 c. P 36,000 b. P 72,000 d. P 24,000 23. 24. Ms. Chelsea had the following transactions in June 2014: 25. 26. Sale of VAT-exempt goods P 200,000 27. Sale of vatable goods 400,000 28. Purchases of VAT-exempt goods 120,000 29. Purchases of vatable goods 250,000 30. 31. All figures are exclusive of VAT. Compute the VAT payable. a. P 42,000 c. P 21,000 b. P 27,600 d. P 18,000 32. 33. The following gross receipts and input VAT relates to a non-profit and non-stock charitable institution in the month: 34. Contribution from the public P 8,000,000 35. Government grant 1,000,000 36. Sales of gift shop items 900,000 37. Rental of vacant premises 1,000,000 38. 39. Input VAT related to shop and rental operations P 112,000 40. Input VAT related to non-profit operations 428,000 41. 42. What is the VAT payable? a. P 0 c. P 768,000 b. P 116,000 d. P 840,000 43. 44. A seller of goods reported the following in the month: 45. 46. Cash sales P 450,000 47. Credit sales (40% collected) 650,000 48. Installment sales (30% collected) 400,000 49. Total sales, exclusive of VAT P 1,500,000 50. 51. Purchases of goods, VAT inclusive 448,000 52. Purchases of equipment, VAT inclusive 1,008,000 53. 54. What is the VAT payable? a. P 132,000 c. P 24,000

b. P 130,200 d. P 0 55. 56. The net income of Aklan Trading Company during the quarter is as follows: 57. 58. Gross income (40% of sales) P 360,000 59. Less: Expenses 120,000 60. Net income P 240,000 61. 62. 37.50% of the expenses were from VAT-suppliers. All the inventories were purchased from VAT suppliers. Inventory increased by P60,000 at the end of the month. 63. 64. Compute the VAT payable. a. P 45,000 c. P 30,600 b. P 37,800 d. P 28,800 65. 66. ABC Construction Company started work on a P5, 600,000 fixed price construction contract. Details of its operations during the quarter is presented below: 67. 68. Total progress billings on the contract P 2,688,000 69. Collection from the contract 2,240,000 70. Depreciation expense 600,000 71. Supplies expense 134,400 72. Salaries expense 400,000 73. Utilities expense, inclusive of P12,000 VAT 140,000 74. 75. Assuming all data are inclusive of VAT, computer the VAT payable. a. P 261,600 c. P 213, 600 b. P 258,600 d. P 210,600 76. 77. A VAT registered seller of goods had the following sales and purchases, exclusive of VAT: 78. 79. Sales P 800,000 80. Sales return and allowances 20,000 81. Purchases 600,000 82. Purchases returns and allowances 40,000 83. 84. The VAT payable is a. P 0 c. P 24,600 b. P 21,600 d. P 26,400 85. 86. Mrs. Baniaga, a fruit and vegetable dealer, had the following sales and purchases: 87. 88. Sales of fruits and vegetables P 800,000 89. Purchases of fruits and vegetables 500,000 90. Purchases of cellophane and containers, exclusive of VAT 20,000 91. 92. Determine the VAT payable. a. P 0 c. P 36,000 b. P 33,600 d. P 34,800 93.

94. A VAT-registered trader reported the following during the month: 95. 96. Export sales P 800,000 97. Domestic sales 1,200,000 98. Purchases 1,000,000 99. 100. The VAT payable is a. P 24,000 c. P 72,000 b. P 60,000 d. P 120,000 101. 102. A domestic seller and exporter had the following summary of trading activities in the quarter: 103. 104. Export sales P 1,000,000 105. Domestic sales 1,500,000 106. Purchases 1,200,000 107. 108. P 36,000 input VAT was applied for a tax refund during the period. P 12,000 109. VAT was paid in the two prior months of the quarter. 110. 111. The VAT payable still due should be a. P 24,000 c. 60,000 b. P 36,000 d. 72,000 112. 113.

Multiple-Choice – Problems: Part 2

1. A realty dealer disposed two residential units during the month: 114. 115. Unit 141 – B P 2,500,000 116. Unit 142 – C 3,500,000 117. Total sales, exclusive of VAT P 6,000,000 118. 119. Total input VAT during the month P 210,000 120. 121. Compute the VAT payable a. P 720,000 c. P 297,500 b. P 510,000 d. P 210,000 122. 2. A VAT-registered restaurant had the following transactions during the month. 123. 124. Receipts from food served P 600,000 125. Receipts from softdrinks 200,000 126. Purchases of rice, meat and vegetables 200,000 127. Purchases of vegetables 100,000 128. Purchases of softdrinks 120,000 129. Purchases of food condiments 80,000 130. 131. Assume all amounts are exclusive of VAT. 132. 133. Compute the VAT payable.

a. P 0 c. P 36,000 b. P 9,600 d. P 72,000 134. 3. A VAT-registered tax practitioner who is using the cash basis of accounting disclosed the following results of operations (exclusive of VAT): 135. 136. Receipts from clients P 5,000,000 137. Advance from clients 1,000,000 138. Salaries expense 3,000,000 139. Depreciation expense 200,000 140. Office supplies expense 500,000 141. Utilities expense 50,000 142. 143. Compute the VAT payable. a. P 150,000 c. P 634,000 b. P 534,000 d. P 654,000 144. 4. A manufacturing subcontractor generated the following receipts from various clients: 145. 146. Receipts from PEZA locator P 4,000,000 147. Receipts from Non-PEZA locators 1,000,000 148. Input VAT traceable PEZA clients 100,000 149. Input VAT traceable to non-PEZA locators 50,000 150. Input VAT on general operations 60,000 151. 152. Compute the VAT payable. a. P 390,000 c. P 50,000 b. P 58,000 d. P 0 153. 5. DZQC, radio broadcasting company with P 8M annual receipts, generated a total revenue of P 1M out of which P 800,000 was collected during the month. It incurred a P 600,000 total expenditures out of which P 224,000 were paid to VAT suppliers. 154. 155. Compute the VAT payable. a. P 0 c. P 48,000 b. P 24,000 d. P 72,000 156. 6. A VAT-taxpayer had the following data during the month: 157. 158. Regular sales P 3,000,000 159. Export sales 1,500,000 160. Input VAT on regular sales (P 80,000 161. applied for tax credit certificate) 100,000 162. 163. Compute the VAT payable. a. P 120,000 c. P 20,000 b. P 100,000 d. P 0 164. 7. An insurer had the following receipts and input VAT data during the month: 165.

166. Life Non-life Total . 167. Cash collection P 4,000,000 P 2,500,000 P 6,500,000 168. Promissory note 500,000 100,000 600,000 169. Traceable input VAT 120,000 80,000 200,000 170. Other input VAT 70,000 171. 172. Compute the VAT payable. a. P 232,000 c. P 207,000 b. P 220,000 d. P 195,000 173. 8. A lessor of commercial spaces had the following receipts and input VAT data for the month: 174. 175. Spaces with P 5,000 monthly rental P 500,000 176. Spaces with P 10,000 monthly rental 800,000 177. Spaces with P 15,000 monthly rental 700,000 178. Spaces with P 20,000 monthly rental 1,000,000 179. Total P 3,000,000 180. 181. Total input VAT during the month 182. 183. Compute the VAT payable. a. P 360,000 c. P 204,000 b. P 270,000 d. P 153,000 184. 9. A domestic airliner had the following transactions during the month: 185. 186. International operation 187. Receipts from outgoing flights P 2,000,000 188. Receipts from incoming flight 2,500,000 189. 190. Domestic operation 191. Transport of passengers P 4,000,000 192. Transport of cargoes, mails, excess baggage 1,500,000 193. 194. Total claimable input VAT P 468,000 195. 196. What is the VAT payable? a. P 309,000 c. P 52,363 b. P 192,000 d. P 12,000 197. 10. A seller of goods had the following sales: 198. 199. Sales of unprocessed agricultural food products P 200,000 200. Sales of processed agricultural products 300,000 201. Sales of non-food products 500,000 202. 203. 204. Input VAT Purchase of goods and supplies P 28,000 Purchase of equipment (4 year life) 24,000 205.

206. Compute the VAT payable. a. P 68,000 b. P 67,500 207.

c. P 48,800 d. P 44,000

Multiple-Choice – Problems : Part 3

1. Denzi Marketing bought a building to house its retail activities. The following relates to its sales and input VAT during the quarter: 208. 209. Sales of goods P 3,000,000 210. Export sales 1,500,000 211. Sales of VAT-exempt goods 500,000 212. Total sales, exclusive of VAT P 5,000,000 213. 214. Input VAT carry-over in the prior quarter P 60,000 215. Input VAT on purchase vatable goods 150,000 216. Input VAT on building (20 year life) 180,000 217. VAT paid prior months 80,000 218. 219. What is VAT payable? a. P 0 c. P 70,000 b. P 64,000 d. P 130,000 220. 2. A VAT-registered bus company had the following receipts in January 2015: 221. 222. Receipts from passengers P 2,700,000 223. Receipts from cargoes 300,000 224. Input VAT on gasoline 50,000 225. Input VAT on bus insurance and repairs 30,000 226. Input VAT on purchase of new bus 360,000 227. 228. What is the VAT payable for January ? a. P 0 c. P 30,000 b. P 27,400 d. P 274,000 229. 3. A domestic sea carrier had the following receipts and attributable input VAT for the month: 230. 231. Receipts from passengers P 2,400,000 232. Receipts from cargoes 600,000 233. Total input VAT for the month 240,000 234. 235. What is the VAT payable? a. P 120,000 c. P 24,000 b. P 48,000 d. P 0 236. 4. A VAT registered television company with annual receipts of P8M reported P 1M total revenue for the month of June 2015. It collected P 1,200,000 from various clients including advances and paid P 800,000 of expenses, P 560,000 of which is paid to VAT suppliers. 237. 238. The collections and payments are inclusive of VAT.

239. 240. What is the VAT payable? a. P 0 c. P 68,571 b. P 52,800 d. P 76,800 241. 5. A bookstore had the following summary transactions during the month: 242. 243. Sales of books inventory P 300,000 244. Sales of school supplies, exclusive of VAT 700,000 245. Rental expense, inclusive of VAT 56,000 246. Salaries expense 100,000 247. Utilities expense, exclusive of VAT 20,000 248. 249. What is the VAT payable? a. P 120,000 c. P 78, 120 b. P 84,000 d. P 77,000 250. 6. Danes Bakeshop had the following details of operations during the month: 251. 252. Sales of bread P 4,000,000 253. Sales of cakes 500,000 254. Importation of flour 1,000,000 255. Other purchases, inclusive of P 240,000 VAT 2,500,000 256. Salaries expenses 500,000 257. Other expenses, exclusive of P 120,000 VAT 1,200,000 258. 259. Compute the VAT payable. a. P 20,000 c. 140,000 b. P 60,000 d. 180,000 260. 7. Sweet Papa Corporation is a VAT-registered sugar refiner. Details of its operations are as follows: 261. 262. Domestic sale of refined sugar P 3,000,000 263. Export sales of refined sugar 2,000,000 264. Purchases of sugar cane P 1,000,000 265. Other purchases, inclusive of VAT 448,000 266. Advanced input VAT paid P 240,000 267. 268. What is the VAT payable? a. P 312,000 c. P 72,000 b. P 272,000 d. P 32,000 269. 8. Baguio General Hospital had the following receipts and input VAT: 270. 271. Receipts from hospital operations P 20,000,000 272. Sales of medicines 4,000,000 273. Input VAT traceable to hospital operations 2,100,000 274. Input VAT on hospital drugstore 120,000 275. 276. Compute the VAT payable. a. P 660,000 c. 300,000

b. P 360,000 d. 260,000 277. 9. A VAT-registered professional review school had the following receipts during the month: 278. 279. Tuition fees P 800,000 280. Miscellaneous fees 100,000 281. Sale of snacks 150,000 282. 283. Reviewer salaries 300,000 284. Purchase of supplies, exclusive of VAT 150,000 285. Other expenses, inclusive of P 16,000 VAT 220,000 286. 287. Compute the VAT payable. 288. a. P 0 c. P 92,000 289. b. P 2,000 d. P 110,000 290. 10. Cordon College had the following receipts and input VAT payments: 291. 292. Tuition fees P 800,000 293. Miscellaneous fees 200,000 294. Input VAT 20,000 295. 296. Compute the VAT payable. 297. a. P 0 c. P 76,000 298. b. P 4,000 d. P 100,000 299. 11. Polaris Company, a VAT seller, had the following sales and purchases during the month as recorded on its books of accounts: 300. 301. Costumers 302. Government Foreigners Others Total . 303. Sales P 1,000,000 P 2,000,000 P 4,000,000 P 7,000,000 304. Purchases 600,000 1,200,000 3,000,000 3,800,000 305. 306. Polaris Company claimed P 45,000 of input VAT on export sales as a tax credit 307. 308. Compute the VAT payable 309. a. P 71,000 c. P 144,000 310. b. P 96,000 d. P 189,000 311. 12. A VAT taxpayer made the following sales: 312. 313. Sale to the government P 250,000 314. Sale to non-profit institutions 350,000 315. Sale to the a registered Ecozone export trader 200,000 316. Sales to persons engaged in business 700,000 317. Sales to persons not engaged in business 500,000 318. Total sales P 2,000,000 319. 320. Purchases and payments, inclusive of VAT P 1,512,000 321.

322. 323. 324. 325. 326. 327. 328. 329. 330. 331. 332. 333. 334. 335. 336. 337. 338. 339. 340. 341. 342. 343. 344. 345. 346. 347. 348. 349. 350. 351. 352. 353. 354. 355. 356. 357. 358. 359. 360. 361. 362. 363. 364. 365. 366. 367. 368. 369. 370. 371.

P 20,000 actual input VAT is traceable to the sales to the government. Compute the VAT payable. a. P 0 b. P 54,000

Answers: True or False 1.F 2. F 3. T 4. T 5. T 6. F 7. T

c. P 56,500 d. P 78,000

372. 373. 374. 375. 376. 377. 378. 379. 380. 381.

8. T 9. T 10. F 11. F 12. T 13. T 14. F 15. F Multiple Choice – Theory

382. 383. 384. 385. 386. 387. 388. 389. 390. 391. 392. 393. 394. 395. 396. 397. 398. 399. 400. 401. 402. 403. 404. 405. 406. 407.

1. A 2. C 3. D 4. A 5. A 6. C 7. C 8. D 9. C 10.C Multiple – Choice Problems: Part 1 1. B 2. D 3. B 4. B 5. A 6. D 7. B 8. C 9. C 10. C 11. D 12. A 13. A 14. C

408. 409. 410. 411. 412. 413. 414. 415. 416. 417. 418. 419. 420. 421. 422. 423. 424. 425. 426. 427. 428. 429. 430. 431. 432. 433.

Multiple Choice – Problems: Part 2 1. C 2. D 3. D 4. D 5. A 6. B 7. D 8. B 9. B 10. C Multiple Choice – Problems: Part 3 1. B 2. B 3. C 4. C 5.C 6.D 7.D 8.B 9.C 10.A 11. A 12. C...