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Exercises (Tax Credits) (2/3 of DEF’s annual output is actually exported) 500,000
Purchases (invoice cost from vat registered entities) 224,000
V. Multiple Choice: Purchases (invoice cost from non-VAT registered entities) 100,000

1. Any input tax attributable to zero-rated sales by a VAT-registered person may at his option be: The VAT payable of CG should be
a. deducted from output tax a. P 180,000 c. P 120,000
b. refunded b. 156,000 d. 108,000
c. applied for tax credit certificate which may be used in payment of internal revenue taxes.
d. all of the above Solution:
Domestic sales P 500,000
2. Tax credit for input taxes shall be allowed if: Transactions deemed sales 500,000
a. Both the seller and the purchaser is VAT registered. Sales to DEF, export enterprise 500,000
b. Either one of the seller or the purchaser is VAT registered as long as VAT invoice is issued. Total sales P 1,500,000
c. Neither one of the seller or the purchaser is VAT registered as long as VAT invoice is issued.
d. The seller is VAT registered regardless of whether the purchaser is VAT registered or not. Output tax (1,500,000 x 12%) P 180,000
Input tax (224,000/1.12 x 12%) (24,000)
3. Which statement is not correct? VAT Payable P 156,000
a. the excess input taxes of a taxable month arising from domestic sales may be carried over the to the
succeeding month. 6. Sofia had the following data for the month of June (all amount is vat exclusive):
b. the excess input taxes of a taxable quarter arising from domestic sales may be carried over to the CASE 1 CASE 2
succeeding quarter. Sales 1,900,000 1,800,000
c. The excess input taxes of a taxable period arising from domestic sales may be refunded. Purchase of Goods 1,260,000 1,600,000
d. The excess input taxes of a payable period arising from export sales may be refunded. Purchases of machines 1,440,000 900,000
Machine Life 6 years 3 years
4. Magnifico Corp. is a vat-registered dealer of appliances. The following data are for the last quarter of the year: The amount of vat payable (excess tax) shall be:
Sales, total invoice value P 6,920,000 a b c d
Purchases, net of input taxes 5,500,000 Case 1 54,000 73,920 73,290 None
Sales return, total invoice value 200,000 Case 2 (84,000) (84,000) 20,000 None
Purchase return, net of VAT 300,000
Deferred input taxes (carried over from the third
quarter of the year) 12,000 Solution:
Case 1: Output tax (1,900,000 x 12%) 228,000
The value added tax payable for the last quarter of the year by Magnifico Corp. is : Input tax – goods (1,260,000 x 12%) (151,200)
a. 84,000 c. P 108,000 Capital goods (1,440,000 x 12% / 60 mos.) (2,880)
b. 96,000 d. 130,500 VAT Payable 73,920
Case 2: Output tax (1,800,000 x 12%) 216,000
Solution: Input tax – goods (1,600,000 x 12%) (192,000)
Output tax (6,920,000 – 200,000/ 1.12 x 12%) P 720,000 Capital goods (900,000 x 12%) (108,000)
Purchases (5,500,000 – 300,000) x 12% (624,000) VAT Payable (excess) (84,000)
Deferred taxes (12,000)
VAT Payable P 84,000 7. Maymay, VAT registered, made the following purchases during the month of January of this year:
Goods for sale, inclusive of VAT 246,400
Supplies, exclusive of VAT 20,000
5. CG Corp. is a VAT registered entity with the following data for a taxable month: Packaging materials, total invoice amount 56,000
Domestic Sales P 500,000 Home appliance for residence, gross of VAT 17,920
Transactions deemed sales 500,000 Office machines (5 pcs), 8 years useful life, net
Export Sales 500,000 of VAT 2,000,000
Sales to DEF, an export-oriented enterprise

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Repair of store amounted to P 20,000, no supporting official receipt. Creditable input taxes are:
a. 38,800 c. 37,440 3. Taxpayers who became VAT registered persons upon exceeding the minimum turn-over of P 3,000,000
b. 34,800 d. 35,520 in any 12-month period, or who voluntarily register even if their turnover does not exceed P 3,000,000
shall be entitled to a transitional input tax on the inventory on hand as of the effectivity of their VAT
Solution: registration on the following, except:
Input tax, goods for sale (246,400/1.12 x 12%) (26,400) a. Supplies for use in the course of taxpayer’s trade or business
Input tax, supplies (20,000 x 12%) (2,400)
b. Goods which have been manufactured by the taxpayer
Input tax, packaging materials (56,000/1.12 x 12%) (6,000)
c. Goods in process for sale
Input tax, office machines (2,000,000 x 12% / 60 mos.) (4,000)
Total creditable input tax (38,800) d. Capital goods being used in the operation of the business.

 Transitional input tax is applicable to taxpayer who shifted from NON – VAT to VAT system. The input tax
Exercises (Presumptive, transitional and other provisions on input taxes) is 2% of the inventory on hand as of the effectivity of the VAT registration or the actual value of VAT
paid to those said inventories, whichever is higher.
1. All of the following are allowed presumptive input tax, except for one.
a. Processor of sardines, mackerel, and milk 4. Transitional input tax can be claimed as deduction from the output tax. Which of the following
b. Manufacturer of refined sugar and cooking oil statements is correct?
c. Producers/ manufacturer of packed noodles a. It can be claimed by a VAT registrable person
d. Supplier of books and other school supplies b. It can be claimed by a taxpayer who registered as VAT taxpayer from the inception of the
business.
 Presumptive input tax is applicable ONLY to sardines, mackerel, milk, instant packed noodles, refined c. It can be claimed by a taxpayer who is initially subject to VAT and subsequently cancelled his
sugar and cooking oil. The tax is 4% of the purchases of the materials necessary to produce these said VAT registration.
products. d. It can be claimed by a taxpayer who is initially paying percentage tax as VAT taxpayer

2. Mantika Corp., a VAT-registered Corp., is a producer of cooking oil from coconut and corn. It had the 5. Which of the following shall be included in the beginning inventory for purposes of determining the
following data for the month of January this year: transitional input VAT?
a. Goods purchased for resale in the ordinary course of business or trade.
Sales, gross of VAT P 784,000 b. Materials purchased for further processing which have not yet undergone processing.
Corn & Coconut, last year 50,000 c. Goods which have been manufactured by the taxpayer
Purchases of Corn & Coconut 330,000 d. All of the above
Corn & Coconut, January of this year 20,000
Purchases from VAT suppliers, VAT 6. A taxpayer registered under the VAT system on January 1, 2019. Value of inventory as of December 31,
Included: 2018 purchased from VAT – registered persons, P 112,000; VAT paid on inventory as of December 31,
Packaging materials 56,000 2018, P 12,000; Value of inventory as of December 31, 2018 purchased, from non-VAT persons, P
Supplies 16,800 518,000; Sales, net of VAT, P 240,000; Sales, gross of VAT, P 45,920; Purchases, net of VAT, P 70,000;
Purchases of VAT exempt goods, P 50,000.
The value added tax payable for the month of January of this year:

a. P 56,060 c. P 60,650 VAT PAYABLE IS:

b. P 54,900 d. 63,000
a. P 23,080 c. P 12,720
Solution: b. P 25,320 d. P 12,230
Output tax (784,000/1.12 x 12%) 84,000 Solution:
Presumptive Input tax, corn and coconut (330,000 x 4%) (13,200) Output tax:
Input tax, packaging and supplies (72,800/1.12 x 12%) (7,800) Sales, net of VAT (240,000 x 12%) 28,800
VAT payable 63,000 Sales, gross of VAT (45,920/1.12 x 12%) 4,920

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Total output tax 33,720 Supplies – Cost, P 40,000; VAT Paid, P 4,000
Input tax:
Purchases, net of VAT (70,000 x 12%) (8,400) During the month, raw materials were purchased from another enterprise with a total invoice value of P
Transitional input tax (112,000 + 518,000) x 2% 12,600 61,600, not included above.
Actual value of VAT 12,000 (12,600)
The VAT payable by Dong Inc. is:
VAT payable 12,720
a. P 72,000 c. P 11,000
 Take note of the amount subject to transitional input tax; it is based on the amount of inventory
b. P 57,000 d. P 66,000
regardless of the source of purchases (VAT or NON-VAT). The law provides only the word “inventory”, it
does not distinguish whether the purchases must be from VAT or NON – VAT suppliers. However, VAT Solution:
exempt inventories are excluded under the list of “inventories”.
Output tax (1,000,000 x 12%) 120,000
Input tax, raw mats and services (400,000 x 12%) (48,000)
7. Carlito, a VAT-registered grocery and sugar dealer submitted the following data as of Dec. 31,2018 to
Input tax, capital goods (400,000 x 12%) (48,000)
the Revenue District Officer:
Input tax, supplies (61,600/1.12 x 12%) ( 6,600)
Grocery items, total value P 350,000 Transitional input tax (120,000 x 2%) 2,400 vs. 2,000 (2,400)
Transitional input tax (40,000 x 2%) 800 vs. 4,000 (4,000)
Raw sugar cane, total value 150,000 VAT payable 11,000

During the month of January 2019, first month as a VAT-registered taxpayer, he had the following sales  If the amount of capital goods purchased is less than 1 million, the input tax thereto shall be deducted in
and purchases: full on the taxable month. If the amount of purchased is more than 1 million the input tax shall be
Sales Purchases amortized over 5 years or the economic life of the capital goods whichever is shorter.

Grocery, total invoice value P 1,195,040 P 708,400 9. What institution is required to deduct and withhold a final VAT of 5% on the purchase of goods or
services subject to VAT?
Raw sugar cane, exc. VAT 570,000 320,000
a. National government or any political subdivisions thereof
The VAT payable for the first month is: b. Government-owned or controlled enterprises
c. Both a and b
a. P 29,400 c. P 45,140
d. Neither a nor b
b. P 47,400 d. P 36,500

Solution: 10. The withholding agent of creditable value added tax is required to remit the amount of value added tax
Output tax (1,195,040/1.12 x 12%) P 128,040 withheld within
Input tax (708,400/1.12 x 12%) (75,900) a. 25 days following the end of month the withholding is made.
Transitional input tax (350,000 x 2%) (7,000) b. 20 days following the end of month the withholding is made.
VAT Payable P 45,140 c. 15 days following the end of month the withholding is made.
d. 10 days following the end of month the withholding is made.
 Sales and purchases of raw sugar are VAT exempt transactions because they are items in their original
state and for human consumption. 11. A VAT-registered supplier sold goods amounting to P 500,000 to a government-controlled corporation
during a particular quarter. Which of the following statements is incorrect in relation to the sale of
8. Dong Inc., a manufacturer had the following data for the first month of 2019: (First year as a VAT goods?
taxpayer) a. The sale is subject to final withholding VAT
b. The government-controlled corporation will withhold VAT of P 25,000
Sales – Exports, P 2,000,000; Domestic (without VAT), P 1,000,000; Purchases, excluding VAT – raw
c. The government-controlled corporation shall remit the withholding VAT to the BIR within 10
materials, P 300,000; Services, P 100,000; Machinery (estimated useful life 2 years), P 400,000.
days following the end of the month the withholding is made.
On January 1, 2019, the company had inventories and taxes paid thereon as follows: d. The VAT-registered supplier may refuse the withholding of VAT as long as it willing to pay the
full 12% VAT.
Raw Materials – Cost, P 120,000; VAT Paid, P 2,000

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 Sale to Government and its GOCC and instrumentalities is not exempt from VAT. However, the VAT payable:
government will withhold 5% of the sales to be remitted to the BIR within 10 days following the end of Output tax P 420,000
the month the withholding is made. Input tax (166,000)
VAT payable P 254,000
Withholding VAT (1,000,000 x 5%) (50,000)
For numbers 12 to 15, use the following data: VAT still due P 204,000
A VAT registered trader has the following transactions:

Sales of good to private entities, net of VAT P 2,500,000 A Vat- registered trader has the following transactions for the month of July 2018:

Purchases of goods sold to private entities, gross of 12% VAT 896,000 Sale of goods to private entities, net of VAT P 2,500,000
Purchases of goods sold to private entities, gross of 12% VAT 896,000
Sales to a government owned corporation (GOCC), net of VAT 1,000,000 Sales to a government owned corporation (GOCC), net of VAT 1,500,000
Purchases of goods sold to GOCC, net of 12% VAT 700,000
Purchases of goods sold to GOCC, net of 12% VAT 700,000 Purchases of Machineries, gross of VAT, useful life is 6 years 11,200,000
12. How much is the output tax?
a. P 300,000 c. P 420,000 17. How much is the VAT payable to the BIR?
b. P 120,000 d. nil a. P 280,000 c. P 191,500
13. How much is the standard input tax? b. P 224,000 d. P 300,000
a. P 20,000 c. P 50,000
b. P 70,000 d. nil 18. Based on the preceding number, how much is the input tax closed to expense (income)?
14. How much is the creditable input tax? a. P 13,500 c. P (13,500)
a. P 166,000 c. P 70,000 b. P 21,000 d. P (21,000)
b. P 96,000 d. P 180,000 Solution:
15. How much is the input tax closed to expense (income)?
a. P 14,000 c. P (14,000) Output tax, sales to private entities (2,500,000 x 12%) 300,000
b. P 34,000 d. P (34,000) Output tax, sales to GOCC (1,500,000 x 12%) 180,000
16. How much is the VAT payable to the BIR? Total Output tax 480,000
Input tax, purchases for private entities (896,000/1.12 x 12%) (96,000)
a. P 404,000 c. P 204,000
Input tax, purchases for GOCC (1,500,000 x 7%) (105,000)
b. P 390,000 d. nil
Input tax, machineries (11,200,000/1.12 x 12%/60 months) * (12,500)
Solution: VAT Payable 266,500
5% withholding VAT (1,500,000 x 5%) (75,000)
Output tax: VAT still due 191,500
Sales to private entities (2,500,000 x 12%) P 300,000
Sales to government (1,000,000 x 12%) 120,000 *allocation
Total output tax P 420,000 Private: 2.5M/4M x 20,000 = 12,500
Standard input tax: GOCC: 1.5M/4M x 20,000 = 7,500
Sales to government (1,000,000 x 7%) P 70,000
Creditable input tax: Actual input tax on purchases for sale to GOCC (700,000 x 12%) 84,000
Purchases, for private entities (896,000/1.12 x 12%) P 96,000 Actual input tax on machinery (see allocation) * 7,500
Standard input tax 70,000 Total input tax 91,500
Total creditable input tax P 166,000 Standard input tax 105,000
Input tax closed to income/expense: Income or expense 13,500
Input tax on purchases for sale to govt. (700,000 x 12%) P 84,000
Standard input tax 70,000
Closed to expense P 14,000

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PISC, a VAT – registered government owned or controlled corporation (GOCC), sold goods to Alpha Corporation, Input tax, government (70,000 – 120,000) * 50,000
a private company. Selling price is P 1,000,000 while the cost (all purchased from vat-registered suppliers) is P Input tax, VAT exempt 20,000
800,000. Total 70,000

19. How much is the VAT payable by PISC? *details:

a. P 120,000 c. P 24,000 Input VAT on sale to govt. 40,000
b. P 50,000 d. P 0 Input VAT, machinery (allocated to VAT exempt and sale to govt.)160,000 x 2/4 80,000
Solution: 1,000,000 – 800,000 = 200,000 x 12% = 24,000 Total 120,000

20. Based on the preceding number, suppose B is also a GOCC, how much is VAT payable by PISC to the BIR? Leomar, a VAT-registered person has the following data:
a. P 120,000 c. P 24,000
b. P 50,000 d. P 0 Export sales, total invoice amount P 3,000,000
Domestic sales, total invoice amount 6,720,000
Solution: Both are government agencies. Purchases used to manufacture goods for export and domestic sales:
Raw materials, VAT inclusive 616,000
Supplies, VAT inclusive 448,000
Alpha Corporation (VAT registered) has the following data for the month:
Equipment, VAT exclusive 300,000
Sales to private entities 2,000,000
Sales – Vat exempt goods 1,000,000 23. The amount of input tax which can be refunded or converted into tax credit certificates at the option of
Sales – government 1,000,000 Leomar is:

The following input taxes were passed-on by VAT suppliers to Alpha Corporation during the month: a. P120,000 c. P 39,600
b. 118,800 d. 50,000
Input VAT on taxable goods 80,000
Input Vat on sale of exempt goods 20,000
Input VAT on sale to government 40,000 Solution:
Input tax on depreciable capital goods not directly attributable Input tax on raw materials (616,000/1.12 x 12%) 66,000
to any specific activity (monthly amortization for 60 mos) 160,000 Input tax on supplies (448,000/1.12 x 12%) 48,000
Input tax on equipment (300,000 x 12%) 36,000
21. The VAT payable for the month is: Total input tax 150,000
a. P 40,000 c. P 160,000
b. P 80,000 d. nil Allocation:
Export sales: (zero rated) 3,000,000 3/9 x 150,000 = 50,000
Solution:
Domestic sales: (6,720,000/1.12) 6,000,000 6/9 x 150,000 = 100,000
Output tax, goods (3M x 12%) 360,000 Total sales, without VAT 9,000,000
Input tax, goods for private (80,000)
Input tax, goods for govt. (1M x 7%) (70,000)  Input taxes against output tax on export sales can be converted into tax credit certificate or be refunded
Input tax, capital goods (160,000 x2/4) (80,000) at the option of the taxpayer.
VAT payable 130,000  It can also be claimed as a tax credit or input taxes to be deducted from output taxes on other form of
5% withholding VAT (50,000) sales.
VAT still due 80,000
24. Based on the preceding number, if the refundable input taxes were not refunded but used as tax credit
22. The amount of input VAT not available for tax credit but may be recognized as cost or expense is: (input tax), the VAT due is:
a. P 60,000 c. P 80,000 a. P 576,000 c. P 666,888
b. P 70,000 d. P 140,000 b. P 697,888 d. P 570,000

Solution: Solution:

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Solution:
Output tax (6,720,000/1.12 x 12%) P 720,000 Output tax (2,000,000 x 12%) 240,000
Input tax (150,000) Less: Input Tax
VAT payable P 570,000 Domestic (690,000 x 12%) 82,800
Export (2,760,000 x 12%) 331,200 414,000
25. But assuming further that the taxpayer opted to claim them as refund, the VAT due is: VAT payable/ excess (174,000)
a. P 576,000 c. P 746,888
b. P 697,888 d. P 620,000 29. Data for a trader with one line of business is subject to value added tax and another line of business not
subject to value added tax (amounts presented are gross of VAT if applicable).
Solution: Output tax P 720,000 Sales, vat business P 896,000
Input tax (100,000) Sales, not-vat business 200,000
VAT payable P 620,000 Purchases of goods, vat business 224,000
Purchases of goods, non-VAT business 33,600
26. Rommel is an operator of taxi cabs. During a particular month, he purchased from Mahindra, a Vat
Purchases of depreciable asset, for use in VAT and non-VAT 112,000
registered car dealer, 10 sedan type units for a total selling price of 5 million pesos. The estimated useful
Purchases of supplies, for VAT and non-VAT business 2,240
life of each vehicle is four years. How much will be the amount due from Rommel? Rental of premises, for VAT and non-VAT business, from non-VAT lessor 22,400
a. P 5,600,000 c. P 5,000,000
b. P 5,150,000 d. P 4,480,000
The VAT payable is:
Solution: 5,000,000 x 1.12 = 5,600,000 a. P 59,808 c. P 82,608
b. P 62,208 d. P 86,208
27. Based on the preceding number, how much input tax can be claimed by Rommel?
a. P 600,000 c. P 150,000 Solution:
b. P 12,500 d. P 0
Output tax (896,000/1.12 x 12%) P 96,000
Input tax (224,000/ 1.12 x 12%) (24,000)
 Rommel is an operator of taxi cabs. He is subject to OPT. The VAT shall be formed part of the Allocated input tax for Vat business *(91,392/1.12 x 12%) (9,792)
expenses or cost of the business. VAT payable P 62,208

28. Data from the books of accounts of a VAT taxpayer for a month: *allocation:
Domestic Exports Sales (VAT business, 896,000/1.12) 800,000 8/10 x 114,240 = 91,392**
Sales P 2,000,000 P 8,000,000 Sales (Non-VAT business) 200,000
Purchases: Total sales 1,000,000
From VAT suppliers:
Goods for sale P 600,000 P 2,400,000 **Subject to allocated Input taxes:
Supplies and service 90,000 360,000
From suppliers paying percentage tax Purchases of depreciable 112,000
Good for sale 100,000 1,500,000 Purchases of supplies 2,240
Supplies and service 20,000 80,000 Total 114,240

30. Tore Inc., a building contractor, showed to you the following data for the month of August 2019:
If the input taxes attributable to zero rated sales are claimed as tax credit, the net value added tax Cash received, gross of VAT P 2,240,000
refundable is: Receivables, net of VAT 3,000,000
Advances on other contracts still unearned (w/o VAT) 1,000,000
a. P 136,000 c. P 145,000
b. P 203,924.70 d. P 174,000
Unpaid Purchases:
For materials, VAT excluded 500,000
For supplies, VAT excluded 100,000
For services, sub-contractors (VAT included) 1,848,000
Payments for purchases made in July:
Materials, gross of VAT 369,600

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Services of subcontractors, net of VAT 495,000 c. Capital gains tax

d. Stock transaction tax of 6/10 of 1%
How much is the VAT Payable?
a. P 360,000 c. P 330,000 33. First statement: Unused input tax of persons whose registration had been cancelled may be converted
b. P 228,600 d. P 90,000 into tax credit certificate which may be used in payment of taxes.
Second statement: Refund or tax credit certificate shall be granted within 25 days from the date of
Solution: submission of complete documents.
Output tax: a. Both statements are correct.
Cash received, gross of VAT (P 2,240,000/1.12 x 12%) P 240,000 b. Both statements are incorrect.
Advances on other contracts still unearned (1,000,000 x 12%) 120,000 c. Only the first statement is correct.
Total output tax P 360,000 d. Only the second statement is correct.

Input tax:
34. Monthly valued added tax declaration is filed on or before the
For materials, VAT excluded (500,000 x 12%) 60,000 a. 10th day from the end of each month.
For supplies, VAT excluded (100,000 x 12%) 12,000 b. 20th day from the end of each month.
Services of subcontractors (495,000 x 12%) 59,400 c. 25th day from the end of each month.
d. 30th day from the end of each month.
Total input tax 131,400
35. The Commissioner or its authorized representative is empowered to suspend the business operations
VAT payable P 228,600
and temporarily close the business establishment of any person for:
a. Failure to issue receipts or invoices of a VAT-registered entity.
31. Cebu Airlines is a corporation organized in the Philippines. It has the following data for the taxable year b. Failure to file a VAT return for VAT registered person as required by the tax code.
in 2019: c. Understatement of taxable sales or receipts by thirty percent or more of his correct taxable sales
Passengers Fare (net of VAT): or receipts for the taxable quarter.
Flights from the Philippines to Hongkong P 1,000,000 d. All of the above.
Flights from Hongkong to Philippines 1,500,000
Domestic flights (gross of 2% withholding tax) 3,000,000 Special Laws (Senior Citizens and PWD)
Fares from cargoes and mails (net of VAT):
36. Lola Lita, a senior citizen, bought a medicine with a selling price of P 9,520 inclusive of VAT. How much is
Flights from Philippines to Hongkong P 1,000,000
Flights from Hongkong to Philippines 1,500,000 the net amount to be paid by Lola?
Domestic Flights (gross of 2% WT) 800,000 a. P 8,500 c. P 6,916
Other Income: b. P 7,616 d. P 6,800
Interest Income from bank deposits 800,000 Solution:
Rent Income 500,000
9,520/1.12 x 80% = 6,800
How much is the output tax?
a. P 456,000 c. P 420,000
b. P 516,000 d. P 0

Solution:

Domestic flights, passengers (3,000,000 x 12%) 360,000

Domestic flights, cargoes (800,000 x 12%) 96,000
Rent income (500,000 x 12%) 60,000
Total output tax 516,000

32. If a dealer in securities sold shares in the local stock exchange, what business tax will apply to such
transactions?
a. VAT based on gross selling price
b. VAT based on gain
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37. Lola Sot, a senior citizen went to Jollibee to treat his 4 grandchildren on account of his retirement. They c. Both statements are correct
consumed goods and beverages with gross amount of P 1,120 inclusive of VAT. How much is amount to d. Both statements are incorrect
be paid by Lolo Sot?
a. P 896 c. P 1,056 42. Gabriana Clinic, a VAT registered entity, performed a prosthetic surgery on the legs of Loyd, a person
b. P 920 d. P 1,100 with disability. The total cost of medical operation inclusive of VAT was P 560,000. Being a disabled
person, Loyd received a 20% discount from Gabriana. How much is the total amount to be paid by Loyd?
Solution: a. P 400,000 c. P 500,000
b. P 448,000 d. P 560,000
1,120/5 persons = 224

224/1.12 x 80% = 160 + (224 x 4 persons) = 1,056 Solution: 560,000/1.12 x 80% = 400,000

38. Lola Trining brought her granddaughter to Jollibee for a treat. Her granddaughter requested that they For the next two questions: Alpha Corporation (vat registered) has the following data for the month:
both order kiddie meals so that the latter will have two (2) new toys since each meal have a free one.
Sales – private entities and P 2,000,000 individuals (10% to sen. Cit.) 2,000,000
The price of each meal is P 120, net of VAT. How much is the amount due from Lola Trining?
Sales – vat exempt goods 1,000,000
a. P 268.80 c. P 240 Sales – government 1,000,000
b. P 230.40 d. P 192

Solution: 120 x 2 = 240 x 1.12 = 268.80

The following input taxes were passed-on by vat suppliers to Alpha Corporation during the month:
39. The ABC Corporation, a vat registered taxpayer sold to Lolo Sot, a senior citizen and to his wife, Ana, a Input vat on goods sold to private entities and individuals P 120,000
person with disability, as follows: Input vat on sale of exempt goods 20,000
Lolo Sot Ana Input vat on sale to government 100,000
Grilled blue marin P 150 P 150
Tokwat baboy 128 43. The VAT payable for the month is:
Pinaputok na tilapia 134 a. P 216,000 c. P 96,000
Seafood Soup 100 100 b. P 108,000 d. P 36,000
Pineapple juice 64
Buko Pandan 70 Solution:
Total 448 448 Output tax, private entities (2,000,000 x 90% x 12%) 216,000
Output tax, government (1,000,000 x 12%) 120,000
The prices above are based on menu prices inclusive of VAT. The output tax due is Input tax, private (120,000 x 90%) (108,000)
a. P 38.40 c. P 96 Input tax, government (1,000,000 x 7%) (70,000)
b. P 48 d. nil VAT payable 158,000
Withholding VAT (1,000,000 x 5%) (50,000)
40. The total amount to be paid by the spouses is: VAT still due 108,000
a. P 640 c. P 800
b. P 758.40 d. P 896 44. The amount of input vat not available for tax credit but may be recognized as cost or expense is:
a. P 20,000 c. P 62,000
Solution: 448 x 2 = 896/ 1.12 x 80% = 640 b. P 50,000 d. nil
Solution:
41. Statement 1: Persons with disability shall be entitled to claim at least twenty percent (20%) discount Input tax, government (100,000 – 70,000) 30,000
from the purchase of certain goods or services for their exclusive use or enjoyment as provided for Input tax, VAT exempt 20,000
under RA2277/RR-1-2009 as amended. Input tax, senior citizen (120,000 x 10%) 12,000
Statement 2: Persons with disability, like senior citizens, shall likewise be entitled to vat exemption. Total 62,000
a. Only statement 1 is correct
b. Only statement 2 is correct

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