34.
M, building contractor, showed to you the following data
Contract price, net P 5,000,000
Cash received for labor (VAT included) 3,000,000
Cash received for materials (VAT included) 360,000
Receivables 2,000,000
Advances on other contracts still unearned (with VAT) 1,120,000
Cash received and held in trust, to be paid to one of his
suppliers, Acme Warehouse, gross of VAT 560,000
Payments to VAT-registered suppliers:
For materials, net of VAT 500,000
For supplies, net of VAT 100,000
For services of sub-contractors (VAT included) 1,680,000
Operating expenses 200,000
The VAT payable of M is
a. P 228,000
b. P 348,000
c. P 350,000
d. None of the above.
35. A, a VAT taxpayer, billed his customer:
Selling Price P 500,000
Value Added Tax 70,000
Total P 570,000
The output tax is
a. P 70,000
b. P 60,000
c. P 61,071
d. P 68,400
36. A PEZA-registered enterprise is paying the 5% preferential tax in lieu of all other taxes. It is
not VAT-registered. Can the same enterprise claim a TCC or refund from any VAT that it
pays on its purchases?
a) Yes, because it should not be paying the VAT as it is exempt from all taxes whether
direct or indirect.
b) No. Since it is VAT-exempt, it is not allowed to claim a refund of input tax paid.
c) Yes, because the issuance of a VAT invoice to the PEZA-registered enterprise was
erroneous.
d) None of the above.
37. JL went out on a date with Ceil, and her uncle, Tito Chris (senior citizen), in Mike’s Bistro
for Ceil’s birthday. They ordered food which they all shared, and the total bill amounted to
₱6,000, gross of VAT.
How much will Mike’s Bistro bill JL?
a) P1,785.71 c) P5,428.57
b) P 357.14 d) None of the above
38. In 2019, M Corporation made total sales of ₱200,000 (net of VAT) to the government. Purchases of
supplies directly attributable to such sales amounted to ₱120,000, net of VAT. Unattributed input
tax allocated to such sales amounted to ₱4,800. The government withheld a 1% EWT on such
purchases.
How much will M Corporation receive from the government?
a) P210,000 c) P212,000
b) P200,000 d) None of the above
39. In number 38, aside from the supplies of ₱120,000, what can M Corporation deduct in computing its
taxable income?
a) P19,200 c) P5,200
b) P14,000 d) None of the above
40. In January 2018, J. Reyes started a car repair business. He did not expect his gross receipts to exceed
₱3.0 Million a year, and thus did not register for purposes of the VAT. He also signified in his first
quarter ITR his intention to be taxed under the 8% income tax rate option. However, by mid-June 2018,
his receipts had already reached the amount of ₱3,000,050.00.
When should J. Reyes register for VAT, and when will he start to become liable for VAT? Will he
still pay OPT under Section 116 of the Tax Code?
a. He should register in July 2018 which is the month following the month where his gross receipts
exceeded ₱3,000,000. He will become liable for VAT starting July 2018. He will be liable for
OPT for the months January to June 2018.
b. He should register within 10 days after the end of June or from July 1 to July 10, 2018. He shall
be liable for VAT on August 1, 2018. He will no longer be liable to OPT.
c. He should register within 10 days after the end of December (the last month of the 12 month
period) or from January 1 to 10, 2019. He shall be liable for VAT beginning on the 1 day of the
st
month following his registration, or February 1, 2019. He will be liable for OPT from January to
December, 2018.
d. None of the above.
41. A Company, VAT-registered, is engaged in stockbrokerage and dealership in securities. It
provided the following data for the 2 quarter of 2018:
nd
Commissions received from stockbrokerage:
Commission received (net of VAT) P150,000
Commission uncollected but earned 250,000
Stock transactions are (VAT excluded):
Price Cost
A Stock P500,000 P 350,000
B Stock 600,000 500,000
C Stock 800,000 650,000
All 3 stocks were sold in the stock exchange.
Supplies bought P88,000, VAT included
a. The percentage tax due is:
b. The VAT payable of A is:
42. The Bureau of Internal Revenue may use “Oplan Kandado” against the following
taxpayer, except?
a. VAT registered person who fails to issue receipts.
b. VAT registered person who fails to file VAT returns.
c. VAT registered person who understates its taxable sales by 30%.
d. VAT registered person who understates its purchase by 30%.
