Taxation BSA Quizzes PDF

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Which is incorrect with respect to business taxes? a. VAT is a top-up tax on sales b. Percentage tax is an expensed tax c. VAT is due quarterly but is paid monthly d. Percentage tax is an explicit consumption tax Which of the following transactions has no consumption tax? a. Importation b. Domestic ...

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1. Which is incorrect with respect to business taxes? a. VAT is a top-up tax on sales b. Percentage tax is an expensed tax c. VAT is due quarterly but is paid monthly d. Percentage tax is an explicit consumption tax 2. Which of the following transactions has no consumption tax? a. Importation b. Domestic consumption from VAT suppliers c. Domestic consumption from non-VAT suppliers d. Exportation 3. Which of these importations is subject to VAT? a. Lumber b. Flour c. Canned tuna d. Wine 4. The sale of which of the following is exempt from business tax? a. Urea fertilizer b. Hybrid corn seeds c. Herbicides d. Chicken dung 5. Which of the following ingredients is exempt from the VAT on importation? a. Ingredients in the manufacture of Improvised Explosive Devices b. Ingredient used in the manufacture of human foods c. Ingredients used in the manufacture of pet feeds d. Ingredients used in the manufacture of poultry or livestock feeds 6. Which of the following agricultural products is not exempt from business tax on sales? a. Ginseng b. Coffee beans c. Tobacco leaf d. Tea leaf 7. Mabiga Cooperative is an agricultural cooperative which processes the coffee production of its members for sale to NesFe Corporation, a coffee processing company selling bottled instant cofee. Mabiga imported a coffee drier from Colombia Coffee Machineries Corporation. After 3 years of active use, Mabiga disposed the drier to Pedro Mabanag, a member. Which of the following is subject to VAT? a. Importation of coffee drier from Colombia b. Sale of coffee drier to Mr. Mabanag c. Sale of coffee to NesFe Corporation d. Sale of coffee by members to Mabiga Cooperative

8. Ammacian Corporation imported goods from abroad for domestic sale. The details of the importation is given below: Peso value of supplier’s invoice Other cost incurred to bring the goods to Philippine port Other inland costs prior to release of goods from Customs Customs duties Freight cost to bring merchandise to Ammacian’s warehouse

P

2,000,000 70,000 85,000

Compute the Customs duties on the dutiable value. a. P 207,000 c. P 215,500 b. P 200,000 d. P 208,500 9. Compute the VAT on importation on the landed cost. a. P 258,600 c. P 282,600 b. P 283,440 d. P 284,460 10. a. b. c. d.

Which is subject to business tax? Business for subsistence Privilege stores Non-resident sellers All of these

11. a. b. c. d.

Which is considered pure consumption tax? VAT on importation Percentage tax Value Added Tax on sales Excise tax

12. a. b. c. d.

Who is statutory liable to pay the VAT on importation? The non-resident seller The resident buyer Both seller and buyer The Bureau of Customs

13. A business taxpayer had the following summarized transactions during the quarter: Cash sales Sales on credit (account sales) Installment sales (P30,000 collected) Sales returns and allowances Quota discounts Advances for goods not yet delivered Purchase of goods, including of P72,000 VAT passed on by sellers Compute the gross selling price.

P 400,000 600,000 100,000 20,000 10,000 20,000 672,000

10%

a. P1,100,000 b. P1,080,000 14.

c. P1,030,000 d. P1,010,000

A lending investor had the following data during a month:

Cash collection for loan principal Cash collection for interest Cash collection for penalties Uncollected loan principal Billed but uncollected interest Billed but uncollected penalties

P 400,000 50,000 6,000 300,000 2,000 1,000

What is the gross receipt? a. P 456,000 c. P 59,000 b. P 450,000 d. P 56,000 15. Geneva Corporation, a VAT lessor which leases commercial spaces to various businesses, received P1,284,000 rentals from various clients, net of 5% withholding tax. What is the gross receipt? a. P 1,200,000 c. P 1,284,000 b. P 1,351,579 d. P

16. A VAT registered seller made the following sales of goods during a month: To customer A To customer B To customer C Total sales

Selling price P 150,000 200,000 102,000 P 452,000

Compute the output VAT. a. P 60,000 b. P 54,240

Fair value P 180,000 190,000 150,000

c. P 62,400 d. P 63,600

17. A VAT-registered seller made the following sales to the following entities: City of San Fernando ABC Trading Company

Selling price P 134,000 100,500

What is the output VAT? a. P 34,080 b. P 28,080

18.

Fair value P 200,000 150,000

c. P 42,000 d. P 40,500

The following pertain to a VAT-registered taxpayer in July 2016:

Fees from senior citizens, before 20% discount

P 225,000

Fees from PWD, before 20% discount Fees received from regular customers Total fees

75,000 340,000 P 640,000

Compute the output VAT assuming the given figures are exclusive of VAT. a. P 48,000 c. P b. P 40,800 d. P 69,312 19. DEF Realty Corporation, a VAT-registered realty dealer, sold the following residential properties during the month:

Residential lot Residential dwelling

Zonal Value P 1,500,000 3,500,000

Compute the output VAT. a. P 0 b. P 580,000

c. P 624,000 d. P 420,000

Assessed Value P 1,200,000 1,500,000

Selling Price P 1,700,000 3,200,000

20. Sarangani, a VAT-taxpayer made a sale of real property with a fair value of P3,000,000 at a selling price of P2,000,000. The sale qualified for installment reporting of output VAT. Sarangani is due to receive the following amounts (net of VAT) in the coming month: Installment Interest Penalty Total

P P

200,000 12,000 4,000 216,000

What is the reportable output VAT on the scheduled collection? a. P 37,920 c. P 25,920 b. P 36,000 d. P 24,420 21. A VAT-registered taxpayer has its own sales operations but also sells goods through consignees. It also sells goods on consignment for a commission. The following were the results of operations for the month ended April 30, 2016: Sales of own inventories Sales made through consignees Sales made for consignors Commission income from consignors Commissions paid to consignees Compute the output VAT. a. P 96,000 b. P 92,400

c. P 80,400 d. P 62,400

P

500,000 150,000 100,000 20,000 30,000

22. Mr. Misamis, a VAT-registered taxpayer, ceases business operation in May 2015. His business properties upon termination of business operation include the following: Cash Accounts receivables Investments Inventories Property, plant and equipment Total assets

P

50,000 120,000 180,000 200,000 800,000 P 1,350,000

Compute the Output VAT on deemed sales. a. P 162,000 c. P 24,000 b. P 120,000 d. P 0 23. Mr. Kudos, a VAT-registered lawyer, had a residence with a zonal value of P2,000,000 and assessed value of P1,500,000. The same was foreclosed by a bank for his failure to pay his bank loan. What would be the output VAT on the foreclosure of the property? a. None, because the same is a capital asset b. None, because the same is below the threshold on residential dwellings c. P 240,000, because the deemed sales is based on fair value d. P 180,000, because deemed sales on foreclosure sales is based on the lower of cost or fair value 24. Mr. Digong sold a commercial land with a selling price of P2,100,000 but with a zonal value of P2,240,000 and assessed value of P 1,500,000. What is the output VAT? a. P 268,800 b. P 252,000

c. P 240,000 d. P 225,000

25. Assuming the same data in the previous problem except that the commercial land was sold for P2,464,000, what would be the output VAT. a. P 295,680 c. P 264,000 b. P 268,800 d. P 240,000 26. Guimaras Company made the following export and domestic sales during the month: Export destination Export for Hong Kong Export for Thailand Export to Japan

Terms FOB destination FOB destination FOB shipping point

Domestic sales Sales to an PEZA FOB destination Sales to a non-VAT customer

Payment $ 100,000 P 450,000 ¥ 800,000 P2,000,000 500,000

Sales to a VAT customer

1,000,000

The exchange rates were as follows: $1 = P45; ¥1 = P0.50. Compute the output VAT for the month. a. P 474,000 c. P 180,000 b. P 420,000 d. P 120,000 27. a. b. c. d.

Which is Exchange Exchange Exchange Exchange

not a deemed sale transaction? of inventory for stocks of property, plants and equipment for stocks of inventory for property of stocks for property

28. A non-VAT retail business exceeded the VAT threshold on October 31, 2016. On that date, it had the following lists of goods on hand which it acquired from VAT suppliers: Snacks foods and grocery items Frozen meat and eggs Fruits and vegetables Shampoos, soaps and detergents Baked bread

P

76,500 30,200 20,360 12,100 6,040

Compute the transitional input VAT. a. P 0 c. P 9,493 b. P 2,904 d. P 10,140 29. A VAT taxpayer had the following data regarding its sales and input VAT during a particular quarter: Sales Regular sales Export sales Sales to government Exempt sales Total

Amount 800,000 400,000 200,000 100,000 P 1,500,000 P

Traceable input VAT P 40,000 18,000 15,000 8,000 P 81,000

Non-traceable input VAT totaled P 24,000. Input VAT applied for tax refund totaled P 6,000. Compute the total Output VAT. a. P 180,000 c. P 120,000 b. P 168,000 d. P 96,000 30. Compute the total creditable input VAT. a. P 99,000 c. P 91,200 b. P 95,400 d. P 85,200 31. Compute the VAT still due. a. P 81,000 c. P 34,800

b. P 76,800

d. P 24,800

32. A non-VAT taxpayer secured the services of a foreign consultant to solve one of its recurring business problems. It contracted to pay P1,000,000 for the consultancy services. Compute the final withholding VAT and the creditable input VAT. a. P 0; P 0 c. P 120,000; P 120,000 b. P 0; P 120,000 d. P 120,000; P 0 33. The sale of a VAT registered taxpayer for the last 12 months failed to exceed the VAT threshold. It made the following sales during the month: Sales of rice Sale of flour Sale of fertilizers and seeds Total Compute the output VAT. a. P 0 b. P 2,400

P P

80,000 20,000 40,000 140,000

c. P 7,200 d. P 16,800

34. A non-VAT professional service provider which exceeded the VAT threshold had the following revenue and collections during the quarter: Total collections, inclusive of P13,440 advances Total revenue

P 268,800 392,000

Compute the total output VAT. a. P 0 c. P 28,800 b. P 27,360 d. P 42,000 35.

An international carrier generated the following receipts:

Passengers Cargoes, mails; excess baggage

Incoming P 1,000,000 500,000

Outgoing P 2,000,000 400,000

Compute the percentage tax. a. P 72,000 c. P 12,000 b. P 60,000 d. P 0 36.     

Mr. and Mrs. Smith have the following children: Damulag, the family’s cook, 23 years old deaf-mute MJ, 21 years old and working as part-time office assistant Pretty Boy, 16 years old young artist of ABS-CBN Minnie, 14 year old BS. Biology student at Harvard University Doraymund, 12 year old Math genius studying at the elite University of Kalinga

Mr. and Mrs. Smith has salaries from employment of P150,000 and P100,000, respectively. Mrs. Smith paid P3,000 health insurance for the family. Compute the taxable income of Mr. and Mrs. Smith, respectively. a. P75,000; P50,000 c. P50,000; P47,600 b. P50,000; P47,600 d. P25,000; P50,000 37. Intrepid, Inc. showed the following computation of its taxable income in 2016. Gross income Less: Other deductions from gross income Net operating loss carry over Taxable income

P 4,000,000 2,000,000 1,000,000 P 1,000,000

This was the first time Intrepid, Inc. reports taxable income since its inception in 2010. Intrepid, Inc. paid P200,000 MCIT in the last two years. During the current year, taxes withheld by clients evidenced by BIR Form 2307 totaled P25,000. Compute the 2016 income tax payable of Intrepid, Inc. a. P300,000 c. P100,000 b. P275,000 d. P75,000 38.

Atlas, Inc. reported the following in 2016:

Taxable income NOLCO claimed Estimated 2010 income tax paid Capital gains, net of tax Passive income, net of tax Exclusions from gross income Exempt income Dividends declared Appropriation for plant expansion

P

400,000 600,000 100,000 50,000 180,000 120,000 200,000 400,000 300,000

Paid up capital and retained earnings grew by P 500,000 and P700,000 in 2016. Atlas, Inc. was assessed for improperly accumulating profit. Compute the improperly accumulated earnings tax. a. P 90,000 c. P 73,000 b. P 70,000 d. P 40,000 39. All of these are exempt from transfer tax, except? a. General renunciation of share in the conjugal property by the surviving spouse b. Transfer of the usufruct in the owner of the naked title c. Proceeds of group insurance received by heirs of the decedent d. Transfer under special power of appointment 40. Non-resident decedent can claim deduction for a. Medical expenses

b. Family home c. Standard deduction d. Transfer for public purpose 41.

On November 1, 2010, Gwen died leaving the following properties: Agricultural land, inherited February 2, 2008 House and lot Cash Car Other personal properties Total properties Mortgage on the agricultural land Other indebtedness Deductible expenses and losses Total ordinary deductions

P 1,200,000 2,000,000 2,800,000 500,000 1,000,000 P 7,500,000 P 500,000 1,200,000 400,000 P 2,100,000

Gwen paid P300,000 in mortgage before his death. The prior estate paid the estate tax on the agricultural which was then valued at P1,000,000. Compute the vanishing deduction. a. P403,200 c. P330,400 b. P388,800 d. P302,400 42. Mr. and Mrs. Coyiuto got married on February 14, 2001. The spouses stipulated the conjugal partnership of gains for their property relation. Mr. Coyiuto died leaving the following properties: Mr. Coyiuto died leaving the following properties:  P800,000 cash inclusive of Mr. Coyiuto’s P200,000 SSS benefits  P200,000 claim from insolvent persons, from the salary of Mr. Coyiuto accruing after marriage  P400,000 second hand car, inherited by Mrs. Coyiuto in 2000  P2,000,000 house and lot, purchased out of Mr. Coyiuto’s salary savings  P300,000 pieces of jewelry, inherited by Mr. Coyiuto from his father  P500,000 agricultural land purchased by Mrs. Coyiuto out of her PCSO winnings during the marriage Compute Mr. Coyiuto’s gross estate. a. P4,200,000 c. P3,800,000 b. P4,000,000 d. P3,600,000 43. Zeus is fast getting ultra-rich. He is now deeply concerned about managing his wealth to minimize his future estate tax. Which of the following estate planning alternative is the least possible strategy you can suggest him?

a. Zeus shall invest P100,000 annually to a Personal Equity Retirement Fund (PERA). b. Zeus and his wife shall invest in life insurance and designate the same as irrevocable to their children. c. Set-up an irrevocable trust fund for his children and contributes therein P100,000 yearly until his death. d. Transfer his properties to his children while he is still living so that the same is subject to a 6% capital gains tax instead of the transfer tax. 44. a. b. c. d.

Which of Donation Donation Donation Donation

the following donation is exempt? to the government for public purpose to the Philippine Inventor’s Commission to accredited non-profit institutions to the Board of Accountancy

45. The following are deductible by a non-resident except a. Donation to the government for public purpose b. Indebtedness assumed by done c. Dowry exemption d. Donation to accredited non-profit institutions

alien

donor,

46. a. b. c. d.

Which of the following is subject to value added tax? Importation of grapes and apples Sale of seaweeds Sale of fire wood and charcoal Sale of husked rice, corn grits and molasses

47. a. b. c. d.

All of the following entities are VAT-exempt, except? Notre Dame, a proprietary hospital Philippine Airlines, a domestic air carrier Bank of the Philippine Islands, a commercial bank Tagbilaran University, a proprietary educational institution

48. a. b. c. d.

Which is subject to VAT? Life insurance companies Operators of hotels, motels and inns International air or sea carrier Agricultural, credit or multi-purpose cooperative

49. a. b. c.

Which is not subject to output VAT? Sale of residential lot for P1,500,000 Direct export sales of goods Cessation of status as VAT taxpayer with respect to all goods or properties on hand d. Sale of residential dwelling for P2,800,000

50. a. b. c.

Which is not a transaction deemed sales? Withdrawal of goods by the proprietor for personal use Corporate merger or consolidation Retirement from or cessation of business

d. Declaring business properties as property dividends 51. Which is not a zero-rated sale of goods or service? a. Transmission of messages message originating from the Philippines to abroad other than news services, embassies and diplomatic calls. b. Sale of gold to the Bangko Sentral ng Pilipinas c. Sale of electricity from hydropower and solar power plants d. Transport of passengers by air or sea from Philippines to abroad 52. Which is correct statement? a. If the monthly aggregate acquisition cost of capital goods exceeds P1,000,000, the input VAT shall be allocated over a period of 60 months starting from the month of purchase. b. The export sales of non-VAT taxpayers are exempt from VAT. c. The excess of input VAT over standard input VAT on government sales is a taxable gain subject to income tax. d. Monthly VAT is due 25 days from the end of each month with the quarterly VAT payable 20 days from the end of each quarter. 53.

Wendy shows the following input VAT during a quarter:

Deferred input VAT Allocation of current input VAT: - To Regular sales - To Zero-rated sales - To Sales to the government* - To Exempt sales

P 150,000 P 200,000 300,000 100,000 50,000

*equivalent to 8% of sales to government Compute the creditable input VAT. a. P800,000 c. P587,500 b. P650,000 d. P350,000 54. Wholesale traders of presumptive input VAT? A. Raw sugar B. Packed noodles a. All, except A b. All, except B

which

of

the

following

is

allowed

C. Mackerel D. Processed milk c. All of these d. None of these

55. Rural Bank of Gumaca, Inc. (RBG) shows the following receipts during a quarter: Interest income from more than 5 year loans Interest income from less than 5 year loans Gain on sale of ROPA Rental income from ROPA Service fees Dividend income

P 1,000,000 6,000,000 400,000 200,000 800,000 100,000

Assuming RBG is not a cooperative bank, compute the gross receipt tax. a. P408,000 c. P385,000 b. P415,000 d. P208,000 56. Phil Co. raised its total outstanding shares by 40% to 70,000,000. This was made by conducting an initial public offering through the Philippine Stock Exchange. The IPO shares were offered and sold for P20 per share. The stock transaction tax is a. P16,000,000 c. P7,000,000 b. P8,000,000 d. P4,000,000 57. Which is a correct statement? a. Distraint and levy should not be implemented simultaneously so as not to violate the proprietary interest of the taxpayer. b. Assessment must be made by the BIR within 5 years from the date the return is filed. Collection shall be enforced within 3 years from the date of such assessment. c. VAT taxpayers shall issue receipts regardless of the amount of the sale. d. Distrait and levy can be effected even in the absence of a prior assessment. 58. Remy was unjustly assessed by the BIR. The followi...