EASY

1. All of the following are taxable under estate taxation, except

A. Property transferred, transferor has the right to take the property back
B. Property transferred under power of appointment which can be exercised in favor of anybody
C. Property transferred, transferor is of advanced age and thought of dying soon
D. Property transferred, transferor has the right to take the property back but waived the right before he
died

2. Business operations can be suspended or temporarily closed by the BIR for the following grounds, except
A. Failure to file a VAT return
B. Failure to issue receipts or invoices by a VAT-registered or registrable taxpayer
C. Failure to register of a VAT-registrable taxpayer
D. The closure of a business establishment shall last for a period of not less than 5 days, and shall be in
forced until the violation is rectified by the concerned taxpayer

3. A taxpayer received during the taxable year the following passive income derived within the Philippines
Interest received on bank deposits under FCDU P231,250
Royalty earned on a software application 95,000
Dividend income received from resident foreign 150,000
corporation
If a taxpayer is a resident alien, the final tax on the passive income would amount to?

4. Which of the following interest income by a resident taxpayer is subject to 15%?

A. Interest income on dollar deposits
B. Interest income on trust funds
C. Interest income from deposit substitutes
D. Interest income from peso bank deposits

5. Statement 1: Inventories of goods for sale which are exempt from value-added tax may be subject to
transitional input tax when the seller becomes liable to VAT for the first time, or when he voluntarily
registers under the VAT system even if his annual turn-over does not exceed P3,000,000.
Statement 2: When a transitional input tax is created, the taxable person shall make a journal entry debiting
“Transitional input tax” and creating merchandise inventory
Statement 3: The purchase of fish to be processed into canned sardines shall entitle the manufacturer of
sardines to a 4% presumptive input VAT
Statement 4: A person who sells his Riceland because he needs money for the hospitalization of his child is
subject to VAT on the sale of real property.
Which of the following statement is wrong?
A. Statement 1 is true while statement 4 is false B. Statements 2 and 3 are false
C. Statements 1 and 2 are true D. Statements 3 and 4 are false

6. All of the revenues and assets of non-stock, non-profit educational institutions used actually, directly and
exclusively for educational purposes shall be exempt from taxes and duties, one of the exception on this
concept is the proprietary educational institutions which shall be subject to tax on their taxable income with
a rate of
A. 10% when unrelated income > related income
B. 30% when related income > unrelated income
C. 10% when related income = unrelated income
D. 30% when unrelated income = related income

7. Pedro single has the following data for 2018

Ordinary income 140,000
Long term capital gain 40,000
Long term capital loss 10,000
How much is the taxable income of Pedro?
a. 100,000 b. 155,000 c. 170,000 d. 180,000

8. A resident citizen taxpayer sold his vacation house with a cost of 5,000,000 for 10,000,000. He purchased
another house for 8,000,000 within 18 months from the month of sale. How much is the capital gains tax
and the carrying amount of the new house?
A. 0;4,000,000
B. 0;5,000,000
C. 600,000; 8,000,000
D. 600,000; 4,000,000
8. The holding period rule applies to
A. Individual seller of real properties classified as capital assets
B. Individual seller of personal properties classified as capital assets
C. Corporate taxpayers on their sale of ordinary assets
D. Corporate taxpayer on their sale of capital assets

9. Gadil operates two (2) pedicabs, two (2) passengers jeepneys plying the route Divisoria -Morayta in Manila,
and three (3) cargo trucks. The gross receipts for the month are
Jeepney No. 1 P22, 000 Truck No 1 P 70,250
Jeepney No. 2 P23,300 Truck No 2 P 85,000
Pedicab No. 1 P800 Truck No 3 P 40,000
Pedicab No. 2 P1,000
What is the percentage tax due on Gadil?
A. 831 B. 1359 C. 735 D. 1413

10. Which of the following is not considered as a percentage tax?

A. ½% stock transaction tax on shares traded through the local stock exchange
B. 5%-10% tax on shares not traded through the local stock exchange
C. 10% overseas communications tax
D. 3% tax on keepers of garage

AVERAGE
1 A VAT registered seller made the following sales to the following entitites
Selling Price Fair Value
City of San Fernando 124,000 200,000
Product X Trading Company 100,500 150,000
Compute for the output VAT

2 In 2018, SB19, an accountant of Beer Corporation, earned a compensation income of P600,000, inclusive of
13th month pay and other benefits in the amount of P100,000, but net of mandatory contributions to SSS,
Pag-Ibig and Philhealth. Aside from employment, he practice his profession on a part-time basis, with gross
receipts of P240,000. His cost of services and operating expenses were P80,000 and P60,000, respectively
and with non-operating income of P30,000.
Compute the income tax payable of SB19 assuming he opted to avail the eight percent (8%) tax rate ?

3. Manok na Pula, resident, gave the following donations:

Donee January 22. 2018
Barba Legitimate daughter, on account of passing the CPA board examination P400,000
Davao City A parcel of land to be used for public purpose, P200,000
Carlo Niece, P150,000
March 25, 2018
Barba On account of marriage on April 10, 2018 – P150,000
Phil Red Cross For medical and rescue purpose, P50,000
The donor’s tax payable on January 22, 2018?

4. Rachel, a minimum wage earner, is employed in Flaten Corporation. In 2018, she received the following
income.
Salary, inclusive of 13th month pay of P10,000 130,000
Overtime pay 50,000
Nightshift differential pay 30,000
Commission income from Flaten Corporation 20,000
How much is the taxable income of Rachel?

5. Kaki, a resident alien decedent was married at the time of death. In 2018, and under the system of absolute
community of property regime. Among the properties in the gross estate was the family home consisting of
Land, inherited by Kaki during the marriage, market value P1,000,000
House built by the spouses on the inherited land P8,000,000
The deduction for family home is:

DIFFICULT
1 A VAT taxpayer had the following data regarding its sales and input vat during a quarter
Sales Amount Traceable Input Vat
Regular Sales 900,000 40,000
Export Sales 450,000 18,000
Sales to government 280,000 20,000
Exempt Sales 100,000 8,000
How much is the VAT still due?
2 Starla made a contribution of P15,000 to St. Jude Parish Church. He had a gross income from business of
P500,000 and deductions (excluding contribution) of P400,000. From this contribution, how much will be
allowed as deduction from his gross income?

3 Gurl Abundant sold her warehouse building to Boy Abunda. The property was acquired by him in 2007 at
250,000. At the time of sale (June 01, 2016) , its accumulated depreciation was P50,000. The terms of the
sales are as follows:
Cash paid, June 1, 2016 50,000
Installment, September 1, 2016 20,000
Installment, December 1, 2016 20,000
Installment, March 1, 2017 155,000
Installment, June 1, 2017 155,000
The income to be reported by Gurl Abundant in 2017 is?

4 Carlo, married, with two dependent children, received the following income in 2018
Rent, Philippines P1000,000
Rent, Hongkong 200,000
Interest, peso deposit, MBTC 100,000
Interest, US$ deposit, BDO ($10,000*42) 420,000
Interest, deposit in Hongkong (HK$10,000*5) 50,000
Prize(cash) won in the local contest 8,000
Prize (TV) won on the local lottery 50,000
PCSO/Lotto winnings 2,000,000
Prize won in contest in U.S. 300,000
Lotto winnings in U.S 100,000
Dividend income, domestic company 600,000
What is the taxable net income of Carlo, assuming he is a resident citizen?

5 The following data are available for the 2 quarters of 2022

1st quarter
Sales P3,360,000
Purchases 1,344,000
Purchase of capital goods-January 1 (net) 2,700,000
Useful life- 3 years
Unused input vat as of end 2021 125,000
nd
2 quarter
Sales 5376,000
Purchases 3,360,000
How much is the vat payable/excess input vat for the second quarter assuming the machinery bought on
January was sold on June 30