NATIONAL MOCK BOARD EXAMINATION 2017 TAXATION 1.
A non-VAT non-VAT person decided to oponally opona lly register his VAT-subject VAT-subject transacons t ransacons under the VAT system. system. He became VAT-registered during the year. He was also engaged in the sale of agricultural and marine food products in their thei r original state. He wanted to, likewise, register registe r, under the VAT VAT system, his VAT VAT-eempt sales. He approached you to seek ad!ice as to what business ta will he be liable to. "hat will be your answer# a. He is liable to VA VAT on is VAT VAT!s"b#e$t t%ansa$&ons t%ansa$&ons in$l"'in( te sale o) a(%i$"lt"%al an' *a%ine )oo' +%o'"$ts in tei% o%i(inal state. b. He is liable to VAT VAT on his VA VAT-subject transacons transacons but eempt eempt from VA VAT on the sale of agricultural agricultural and marine food products in their original state. c. He is not liable to VAT VAT on his VA VAT-subject transacons transacons and the sale of agricultural agricultural and and marine food food products in their original state. d. He is not liable to any business business ta ta because he is not not $uali%ed to oponally oponally register register under under the VA VAT system.
2.
An indi!idual who is a pure compensaon income earner is allowed to deduct the following from his gross compensaon income ecept& a. 'asi 'asicc per perso sona nall ee eemp mpo on. n. b. Addi Addio ona nall eem eemp pon. on. c. (remium (remium paymen paymentt on health health and) and)or or hospit hospitali* ali*ao aon n insuran insurance. ce. '. ,e%s ,e%son onal al e-+en -+ense ses. s.
.
An indi!idual who a!ails of oponal standard deducon cannot deduct the following ecept& a. cost cost of sale sales. s. b. busin business ess epens epenses. es. c. premium premium on health health and)or and)or hospitali hospitali*a *aon on insurance. insurance. '. basi$ +e%sonal +e%sonal e-e*+&o e-e*+&ons ns an' a''i&onal a''i&onal e-e*+&on. e-e*+&on.
/.
The personal eempon allowed to estate and trust is& a. ,20000 c. (+, b. (+, d. none. ot allowed personal eempon.
Use the following items for the next 4 items
A VAT VAT-registered -registered praconer, praconer, single and resident ci*en, has %!e /+0 dependents dependents li!ing with and dependent upon him for chief support. Two /0 of the dependents are minors who are legally adopted. 1ne is a child out of wedlock, person with disability disability,, + years old. The other two /0 are his brothers, who are both minors. minors. 2uring the %rst $uarter of the current, he earns and spends the following /net of applicable taes0& 3ross re receipts from pr pracce of of pr profession, ne net of of 4 45 wi withholding ta ta (4,64, 7ost of ser!ices/85 VAT-subject0 +, 9alary from part-me teaching job, net of +5 withholding ta 4:,+ ;pe ;pens nses es in conn connec eco on n wit with h the the prac pracc ce e of of pr profes ofessi sio on /< /<5 5 VA VAT- sub subje ject ct00 4, 4, VAT payments for =anuary and >ebruary 4, .
How much is the personal eempons for the $uarter# a. (4+, b. (4+,
c. (6+, d. None o) te $oi$es
.
How much is the taable net income using itemi*ed deducons# c. (4,48, a. ,100000 b. (4,46+, d. one of the choices
7.
How much is the taable net income using 192# a. (4,:, b. (4,46+,
$. ,11/0000 d. one of choices
3.
1ne of the following is not an important factor when compung the taable net gi?s and the gi? ta payable. a. @esid @esiden ence ce of of the the dono donorr b. 7i*e 7i*ens nship hip of of the donor donor c. 'lood 'lood relaons relaonship hip betwee between n the donor donor and the the donee '. Te e$ono*i$ e$ono*i$ stat" stat"ss o) te 'onee 'onee
4.
=ohn transfers his car to his brother 9amuel for (8,. The sold car costs (+,. At the me of the transfer, the car has a fair market !alue of (:,. =ohn in$uires from you whether or not he is re$uired to %le donors ta return and pay donors ta. "hat will you tell him# 4 B
(age
a. b.
c. d.
10.
He has to %le a donors ta return because the transfer will be considered a transfer for insuCcient consideraon because the selling price is less than the cost. He 'oes not a5e to 6le a %et"%n be$a"se it is a t%ans)e% )o% s"$ient $onsi'e%a&on en$e no 'ono%8s ta- is '"e. He has to %le a donors ta return and pay donors ta because transfers to rela!es are generally subject to donor ta. He does not ha!e to %le a return because the 'D@ will not be in a posion to know the transfer as it is done between brothers.
A stockholder of a closely held corporaon owns 4, shares before the D(1. The par !alue of the share is (4,,. 2uring the D(1, the shares are selling at (4 per share. His broker-friend ad!ises him not to sell his shares during the D(1 but instead wait unl a?er the D(1. A?er the D(1, the outstanding shares of the closely held corporaon are 4,, shares and are now selling at (48 per share at the local stock echange. The stockholder of the closely held corporaon approaches you to seek your ad!ice because he is also planning to sell the shares directly to his friend and, therefore, not traded through the local stock echange at (4+ per share. How much is the capital gains ta if he sells the shares directly to his friend# a. (+,6+ c. (4+, b. ,/000 d. one of the choices
11.
7hing Ah 7hung, accomplished singer from Hongkong, is included in one of the local %lms produced by 'ebecu (roducons. 7hing Ah 7hung stays in the (hilippines for %!e /+0 months and makes the (hilippines his temporary home as re$uired in the contract. How will you classify 7hing Ah 7hung for (hilippine income ta purposes# a. @esident ci*en b. Resi'ent alien c. on-resident alien engaged in trade or business d. on-resident alien not engaged in trade or business
12.
ash 9ingha, non-resident Dndian naonal doing business in the (hilippines, seeks your ad!ice whether or not he is allowed to claim personal eempons for (hilippine income ta purposes. "hat will your answer be# a. He is not allowed to claim personal eempons for (hilippine income ta purposes because he is not a resident. b. He is allowed to claim personal eempons for (hilippine income ta purposes because being a nonresident alien doing business in the (hilippines entles him to such eempons at all mes. $. He is allo9e' to $lai* +e%sonal e-e*+&ons )o% ,ili++ine in$o*e ta- +"%+oses i) te $o"nt%: 9e%e e is a $i&;en o% %esi'ent allo9s +e%sonal e-e*+&ons to $i&;ens o) te ,ili++ines not %esi'in( te%ein. d. He is not allowed to claim personal eempons for (hilippine income ta purposes because there is no showing that he intends to reside in the (hilippines permanently.
1.
Ers. .A. Dwanan is an employee of a (hilippine corporaon. Her husband is working as an 1>" for years and has no income from (hilippine sources. 2uring the %ling of her (hilippine income ta return, she asks you whether she can claim the addional eempons or not. "hat will your answer be# a. 9he cannot claim the addional eempon because the husband shall be the proper claimant of the addional eempon for $uali%ed dependent children unless he eplicitly wai!es his right in fa!or of his wife. b. 9he can claim the addional eempon pro!ided her husband eplicitly wai!es his right in her fa!or. $. <e $an $lai* te a''i&onal e-e*+&on e5en 9ito"t a 9ai5e% o) e% "sban'8s %i(t be$a"se 9e%e te s+o"se o) te e*+lo:ee is "ne*+lo:e' o% is a non!%esi'ent $i&;en 'e%i5in( in$o*e )%o* )o%ei(n so"%$es te e*+lo:e' s+o"se 9itin te ,ili++ines sall be a"to*a&$all: en&tle' to $lai* te a''i&onal e-e*+&on )o% $il'%en. d. 9he can claim the addional eempon if the 'D@ rules in her fa!or.
1/.
A single indi!idual tapayer, resident ci*en, has the following dependents during the year& Andres, senior ci*en, not a rela!e 'en, person with disability, child, years old 7armen, 4 years old, resides abroad because of sickness 2a!id, child with his li!e-in partner, 4< years old How much total addional eempons can this tapayer claim# a. (4, c. (+, b. , 7000 d. (+,
1.
A tapayer is supporng three /:0 persons with disabil ity. The %rst one is a nephew who is 4F years oldG the second one is a child out of wedlock, 4< years old and the third one is a child who is + years old. He asked you how much addional eempon he can claim. "hat will your answer be# a. (6+, c. (+, B
(age
b.
,0000
d. one
1.
icolas placed a property under trust in fa!or of his son, icolas DD. He designated =ulian as a trustee. nder the term of the trust, =ulian has full discreon on what to do with the income of the property under the trust. "ho is the tapayer for income ta purposes# a. icolas c. =ulian b. icolas DD '. T%"st
17.
Er. =ose Vicente is a sole proprietor engaged in trading business. He consults you as to what income ta returns he will %le. "hat will your answer be# a. He is re$uired to %le $uarterly income ta returns only because he is engaged in business. b. He is not re$uired to %le $uarterly income ta returns because indi!iduals are re$uired to %le annual returns only. $. He is %e="i%e' to 6le ="a%te%l: %et"%ns an' ann"al %et"%ns be$a"se e is en(a(e' in b"siness. d. He is not re$uired to %le any income ta return because he is a sole proprietor, hence, eempted from %ling returns.
13.
Er. >ausno 9antos, testator, appointed Er. 3eneroso 7ru* as the eecutor of the estate. Er. 9antos was a ci*en of Argenna and a resident ofIue*on 7ity. He was in 7alifornia, 9A !ising his son when he died. He owned a Eercedes sports car and had se!eral bank deposits in the 9A. The eecutor asked you whether or not the car and the bank deposits in the 9A will sll ha!e to be declared as part of the (hilippine gross estate of >ausno 9antos. Argenna does not impose transfer taes of any kind. "hat answer will you gi!e him# a. Te $a% an' te ban> 'e+osits in te ?
14.
A client asked you whether or not to add the gi?s made in the pre!ious months to the gi?s made in the current month of the same calendar year. "hat would your answer be# a. The gi?s made in the pre!ious months should not be added to the gi?s made in the current month because the computaon of the taable net gi?s is on a per gi? basis o!er a period of one calendar year. b. The gi?s made in the pre!ious month should be added to the gi?s made in the current month because the computaon of the taable net gi?s is cumula!e basis o!er a period of one calendar $uarter. c. The gi?s made in the pre!ious months should not be added to the gi?s made in the current month because the 'D@ would ha!e no way of knowing them anyway. '. Te (i@s *a'e in te +%e5io"s *onts so"l' be a''e' to te (i@s *a'e in te $"%%ent *ont so tat te +%o(%essi5e ee$t o) 'ono%8s ta- 9ill be )elt.
20.
A VAT-registered tapayer treated the ecess of output VAT o!er input VAT as epense and was shown in the 9tatement of Dncome and ;penses. Ds it the proper treatment of VAT# a. Jes. VAT is treated as epense and is properly shown in the 9tatement of Dncome and ;penses. b. No. VAT +a:able is $onsi'e%e' as $"%%ent liabilit: an' *"st be so9n in te inancial 7ondional if it is fa!orable to him. d. o. There is no clear rule on how to treat VAT payable.
21.
A resident ci*en makes o!erseas calls to his parents who li!e in the nited 9ates of America. There are mes when it is his parents turn to call him from the 9A. The calls are personal in nature and are paid for by his parents in 9A. He asked you whether or not he is subject to the 45 o!erseas communicaons ta. "hat will you tell him# a. He is subject to the 45 o!erseas communicaons ta on his calls to his parents. b. He is subject to the 45 o!erseas communicaons ta on his calls to his parents and the calls of his parents originaon from 9A. c. He is not subject to the 45 o!erseas communicaons ta because the calls are personal in nature. '. He is not s"b#e$t to te 10 o5e%seas $o**"ni$a&ons ta- be$a"se te $alls a%e +ai' )o% b: is +a%ents 9o a%e in ?
22.
: B
(age
DV.
a. b. $. '. e.
The bene%t had been a!ailed of only once.
D, DD, DDD and DV D and DD only II an' III onl: DDD and DV only D and DV only
2.
"hich of the following shall be subject to garnishment and not distraint# a. 9tocks and other securies b. 2ebts and credits $. Ban> a$$o"nt '. one of the abo!e
2/.
"hich of the following dependents does not $ualify a tapayer for an addional eempon# a. @ecogni*ed natural son who celebrated his 4 st birthday during the taable year b. 9on who is + years old, unmarried, but incapable of self-support due to mental defect $. Mino% son 9o (ot e*+lo:*ent in te +%e5io"s ta-able :ea% '. Einor son who died in 2ecember :4 of the taable year
2.
Lid Lulapu is a boer sanconed by the Amateur 'oing Associaon of the (hilippines /A'A(0 and was sent to Eacau to compete in the 48 "orld 'oing 7hampionships. He won the gold medal a?er defeang the opponent from 7uba, 'lack Mloyd. pon his return from the compeon, he was awarded (h( +,, by Vino Lulafu, Dnc. for his achie!ement. "hat is the ta conse$uence of the award recei!ed by Lid# a. 9ubject to income ta since the amount is substanal and will be considered addion to the eisng wealth of Eanny b. Not s"b#e$t to in$o*e ta- sin$e it 9ill )all "n'e% e-$l"sions )%o* (%oss in$o*e $. 9ubject to %nal withholding ta on the part of 7alla since this is considered income payment to Eanny. '. ot subject to income ta since Eanny brought presge to the country by becoming a world champion
2.
"hich of the following statements is incorrect# a. "hen compensaon is recei!ed in money, the measure of the income is the amount of money recei!ed b. "hen compensaon is recei!ed other than in money, the fair market !alue of the thing taken in payment is the measure of income. $. Df ser!ices were rendered at a spulated price, in the absence of the proof to the contrary, such price will be presumed to be the fair market !alue of the compensaon recei!ed. '. Te )ai% 'is$o"nte' 5al"e o) a non inte%est bea%in( note iss"e' as se$"%it: )o% +a:*ents sall be t%eate' as in$o*e as o) te &*e o) %e$ei+t.
27.
7orporaon N sold some of its shares of stock from which it reali*ed pro%t therefrom. A poron of this pro%t was gi!en as bonuses or allowances to the corporate oCcers as authori*ed by its laws. D. The bonuses and allowance are deducble from gross income as ordinary and necessary epenses. DD.
The bonuses and allowances are disguised as di!idends which are not allowed to be deducble from gross income. a. b. $. '.
1nly D is correct. Onl: II is $o%%e$t. 'oth D and DD are correct. either D nor DD is correct.
23.
"hich of the following is not taable in the (hilippines# a. (ersonal property produced within, sold without b. (ersonal property produced without, sold within $. ,e%sonal +%o+e%t: +"%$ase' 9itin sol' 9ito"t d. (ersonal property purchased without, sold within
24.
"hich of the following is)are not a test in determining whether income is earned for income ta purposes# a. @eali*aon principle b. 7laim of right doctrine c. ;conomic bene%t theory d. 9e!erance test theory 8 B
(age
e.
0.
"hich of the following income ta implicaons on capital gains presumed to ha!e been reali*ed from the sale, echange or disposion of lands and)or buildings located in the (hilippines, which are classi%ed as capital assets is)are true# a.
Df sold by a domesc corporaon, shall be subject to the capital gains ta of K5 based on the gross selling price or current fair market !alue whiche!er is higher of such land and)or building Df sold by a resident foreign corporaon, shall be subject to the ordinary income ta Df sold by a non-resident foreign corporaon, shall be subject to the :5 %nal withholding ta />"T0 Df sold by a non-resident alien not engaged in trade or business /A;T'0, shall be subject to the capital gains ta of K5 based on the gross selling price or current fair market !alue whiche!er is higher of such land and)or building All o) te $oi$es
b. c. d.
e. 1.
None o) te $oi$es
"hich of the following statement)s is)are true# D. Df the general professional partnership /3((0 a!ailed of the itemi*ed deducon in compung its net DD.
income, the partners cannot claim itemi*ed deducons from said share. Df the 3(( a!ailed of itemi*ed deducons, the partners are not allowed to claim the oponal standard
DDD.
deducon /1920 from their share in the net income. Df the 3(( a!ails of 192 in compung its net income, the partners comprising it can no longer claim further deducon from their share in the said net income.
D, DD and DDD D and DD only D and DDD only II an' III onl:
a. b. $. '. 2.
"hich of the following is)are not taable for income ta purposes# D. @eco!ery of damages /compensaon for injuryG from tortuous acts0 DD. @eco!ery of damages pertaining to reco!ery or return of loss income or pro%t DDD. @eco!ery of items pre!iously deducted from gross income /ta bene%t rule0 DV. >orgi!eness of indebtedness /if eOect of enre transacon is a reducon of purchase price of property ac$uired in prior year0 D, DD, DDD and DV DD and DDD only DDD and DV only I an' IV onl:
a. b. $. '. .
"hich of the following is)are not re$uired to %le an income ta return# D. A ci*en of the (hilippines engaged in business or pracce of profession whose gross income does DD. DDD.
not eceed his total personal and addional eempons for dependents. An indi!idual whose sole income has been subjected to %nal withholding ta. A minimum wage earner or an indi!idual who is eempt from income ta pursuant to the pro!isions
DV.
of the Ta 7ode, as amended, and other laws, general or special. An indi!idual deri!ing compensaon concurrently from two or more employers at any me during the taable year
a. b. $. '.
D, DD, DDD and DV II an' III onl: DDD and DV only D and DV only
The 7ommissioner may compromise the payment of any internal re!enue ta when& D. A reasonable doubt as to the !alidity of the claim against the tapayer eists DD. The ta or any poron thereof appears to be unjustly or ecessi!ely assessed DDD. The administraon and collecon costs in!ol!ed do not jusfy the collecon of the amount due DV. The %nancial posion of the tapayer demonstrates a clear inability to pay the assessed ta a. D, DD, DDD and DV b. II an' III onl: $. DDD and DV only '. I an' IV onl:
/.
.
True or >alse
+ B
(age
D. A charitable instuon which deri!es income from paying paents, whether out-paent, or con%ned in the hospital is subject to income ta. DD. Dncome of pension trust is eempt from income ta.
A. D trueG DD false B. I )alse II t%"e
7. 'oth are true 2. 'oth are false
.
NJP 7orporaon, a domesc corporaon, has the following data in 4K& 3ross sales /net of withholding ta of 450
8,F+,.
'usiness epenses
,+,.
3ain on sale of business assets
6,.
Dnterest on >72 deposit with '21, net ta
4<,+.
9ale of shares of stocks, not listed and traded 9elling (rice
+,.
7ost
4K+,.
2i!idends from E1 7orporaon, domesc
F+,.
2i!idends paid during the year
F,.
@eser!ed for building ac$uision
:,.
Dn 4+, the 7orporaon suOered an operang loss of ( :,. This amount was carried forward and claimed as deducon from gross income in 4K. How much is the improperly accumulated earnings ta# a. b. c. '.
7.
"hich of the following is)are taable housing fringe bene%t# D. DD.
DDD. a. b. $. '. 3.
Housing pri!ilege of the Armed >orces of the (hilippines /A>(0 A housing unit, which is situated inside or located with K meters away from the perimeter of the business premises Temporary housing for an employee who stays in a housing unit for three months or more D, DD and DDD D and DD only D and DDD only II an' III onl:
Dn Q1peraon Landado,R the 'D@ temporarily closed business establishments, including 7heng 7orporaon that failed to comply with VAT regulaons. 7heng 7orporaon contends that it should not be temporarily closed since it has a !alid and eisng VAT registraon, it faithfully issued VAT receipts, and %led the proper VAT returns. The contenon may be rejected if the 'D@ in!esgaon re!eals that a. b. c. '.
4.
4K4,6+ 4<:,F 4<8,: 13/72
the tapayer has not been regularly %ling its income ta returns for the past 8 years. the tapayer deliberately %led a false and fraudulent return with deliberate intenon to e!ade taes the tapayer used falsi%ed documents to support its applicaon for refund of taes. te%e 9as an "n'e%state*ent o) ta-able sales o% %e$ei+ts b: 0 o% *o%e )o% te ta-able :ea%.
=ay 7orporaon is registered under the laws of the Virgin Dslands. Dt has etensi!e operaons in 9outheast Asia. Dn the (hilippines, its products are imported and sold at a mark-up by its eclusi!e distributor, @oys Trading, Dnc. The 'D@ compiled a record of all the imports of @oy from =ay and imposed a ta on =ays net income deri!ed from its eports to @oy. Ds the 'D@ correct# a. Jes. =ay is a non-resident foreign corporaon engaged in trade or business in the (hilippines. b. o. The ta should ha!e been computed on the basis of gross re!enues and not net income. $. No. a: is a non!%esi'ent )o%ei(n $o%+o%a&on not en(a(e' in t%a'e o% b"siness in te ,ili++ines. d. Jes. =ay is doing business in the (hilippines through its eclusi!e distributor @oys Trading, Dnc. K B
(age
/0.
A'7 Transport 9er!ices is a bus company with license to operate from the MT>@', as such it is subject to S a. Co**on Ca%%ie%s Ta-. b. 45 Value Added Ta. c. ;cise ta. d. :5 Dnternaonal 7arriers Ta.
/1.
The VAT accrues on the sale of ser!ices upon the occurrence of the following e!ent S a. Dssuance of a statement of account by the supplier to the customer. b. 7ompleon of the ser!ice by the supplier to the customer. c. (ayment by the customer of the complete price of the ser!ice. '. ,a:*ent b: te $"sto*e% )o% an: +a%t o) te se%5i$e.
/2.
@omualde* recently bought %!e units of H2 tele!ision sets with home theater system from 92L Appliances with a list price of (hp 6,+. @omualde* was gi!en a trade discount of 4+5, purchase discount is :)4, n):. 7ost of freight as reected in the bill of lading of the forwarder is (hp 4,K8< per tele!ision set, >1' shipping point, freight collect. How much shall be the input ta on the purchase of tele!ision sets# a. (hp :<,<:F b. ,+ 01 c. (hp ::,
/.
2onaons to which of the following enes shall not be eempt from donors ta under special laws# a. Dntegrated 'ar of the (hilippines b. (hilippine-American 7ultural >oundaon c. @amon Eagsaysay Award >oundaon '. ,ili++ine Li)e Ins"%an$e Co%+o%a&on
//.
The gross income of an employee amounted to ( :4,, which includes ( 4+, mone*ed 4-day !acaon lea!e. How much is his taable gross compensaon income# a. (:4, b. ,24000 c. (:+, d. (
/.
3io!anni, whose family is a resident of Aurora (ro!ince, has four children. Dn compung his income ta liability for the taable year 4:, he made the following representaons about his four children& D. DD. DDD. DV.
3lenn, , li!ing in Eanila for his terary educaon 3wen, 4<, married to Tim 3ail, +, mentally challenged 3ab, 4, a lo!e child
How much may 3io!anni claim as addional eempon in compung his income ta liability# a. (4, b. ,7000 c. (+, d. (+, e. (
/.
"hich of the following is not passi!e income subject to %nal ta# a. "innings from loUery, rae draws in the (hilippines. b. @oyalty income from copyrights used in the (hilippines. $. ,%i;es )%o* a s+o%ts $ontest in te ,ili++ines a*o"n&n( to ,+ 10000. d. 7ash di!idends recei!ed by indi!iduals from domesc corporaons.
/7.
7ompania Dtalliani is a corporaon in Dtaly. 2uring the ta year, it distributed di!idends to its stockholders. >ilipinas, Dnc., a (hilippine company which has in!estments in stocks in Dtalliani, recei!ed said di!idends. a. 2i!idends are not taable. b. 2i!idends are taable at :5 or at 4+5 if the corporaon is subject to a ta sparing credit. $. Di5i'en's a%e ta-able at 0. d. 2i!idends are taable at +5.
6 B
(age
/3.
As a 7(A what would you tell if a domesc corporaon asked you how many %nancial statement and ta return copies are %led with the 'D@# a. copies b. : copies $. / $o+ies d. As many as re$uired by the re!enue oCcer
/4.
The following shall be considered as Wde minimisW bene%ts not subject to income ta as well as withholding ta on compensaon income of both managerial and rank and %le employees, ecept& a. Eone*ed !alue of !acaon and sick lea!e credits paid to go!ernment oCcials and employees b. Mone&;e' "n"se' si$> lea5e $%e'its o) +%i5ate e*+lo:ees not e-$ee'in( ten F10G 'a:s '"%in( te :ea% c. Eedical cash allowance to dependents of employees, not eceeding (6+ per employee per semester or (4+ per monthG d. @ice subsidy of (4,+ or one /40 sack of + kg. rice per month amounng to not more than (4,+G
0.
"hich of the following methods of depreciaon is not expressly enumerated under the Ta 7ode# a. O"t+"t o% +%o'"$&on *eto' b. 9um-of-the-years-digit method c. 9traight-line method d. 2eclining-balance method
1.
>or how many years is the tapayer re$uired to maintain hard copies of books of accounts, including subsidiary books and other accounng records# a. years b. : years $. :ea%s d. 4 years
2.
;Oec!e =anuary 4+, bene%ts recei!ed by an employee by !irtue of a 7ollec!e 'argaining Agreement /7'A0 and produc!ity incen!e schemes combined are ta eempt, pro!ided that it does not eceed (XXXXXXXXXXX per employee per taable year. a. ( +, b. , 10000 c. ( :, d. ( <,
.
"hat is the 29T rate on original issue of shares of stock# a. One +eso F,1.00G on ea$ t9o "n'%e' +esos F,200G o% )%a$&onal +a%t te%eo) o) te +a% 5al"e o) s"$ sa%es o) sto$> b. 9e!enty-%!e-centa!os /(.6+0 on each two hundred pesos /(0, or fraconal part thereof, of the par !alue of such stock c. >i?y-centa!os /(.+0 on each two hundred pesos /(0, or fraconal part thereof, of the par !alue, of such shares of stock d. Twenty-%!e-centa!os /(.+0 on each two hundred pesos /(0, or fraconal part thereof, of the par !alue, of such shares of stock
/.
The 'ureau of Dnternal @e!enue /'D@0 shall be under the control and super!ision of the a. De+a%t*ent o) inan$e b. 7ourt of Ta Appeals c. 9upreme 7ourt d. 2epartment of Dnterior and Mocal 3o!ernment
.
9e!en Lingdoms 7orporaon, a domesc corporaon, declared and distributed to its stockholders shares of @ed Leep 7orporaon. 1ne of its stockholders, Theon 3reyjoy, recei!ed 4 shares of @ed Leep 7orporaon shares as di!idends. At the date of di!idend declaraon, the fair market !alue of @ed Leep 7orporaon shares was (4 per share and by the me Theon 3reyjoy recei!ed the di!idend, the fair market !alue per share was (4<. The di!idend is a. A stock di!idend, hence eempt from ta b. A property di!idend which will form part of taable income of Theon 3reyjoy c. A property di!idend which is subject to %nal ta based on its fair market !alue of (4< per share '. A +%o+e%t: 'i5i'en' 9i$ is s"b#e$t to 6nal ta- base' on its )ai% *a%>et 5al"e o) ,120 +e% sa%e
.
Which of the following statements is true? a. b. c. d.
The 2epartment of >inance may grant eempon from all forms of taes Inte%ests +ai' in$i'ent to ta- 'elin="en$: a%e allo9e' as 'e'"$&on )%o* (%oss in$o*e @entals of personal properes are subject to +5 epanded withholding ta >ringe bene%t ta is computed based on the monetary !alue of the fringe bene%t
< B
(age
7.
@obert 'aratheon, a resident ci*en, single with + $uali%ed dependent illegimate children had the following during the calendar year 4+& 7ompensaon income +, th 4: month pay , 7hristmas bonus 6+, ;mployment ;penses 4, 999 premium contribuons :,K (hilHealth contribuon ,8 (ag-ibig contribuon , nion dues 4, (remiums on health insurance 8, 4st 9tatement& The taable income a?er total personal eempon is (48,. nd 9tatement& The total personal eempon is (+,. :rd 9tatement& The non-taable 4:th month pay and other bene%ts is (:,. 8th 9tatement& The deducble premiums on health insurance is *ero since the annual gross income of the family eceeds (+,. "hich of the abo!e statements is)are correct# a. 4st and nd statements b. nd and : rd statements c. :rd and 8th statements '. /t an' 1st state*ents
3.
9tatement 4& Dncome items subjected to %nal ta are no longer included in compung the taable income of the tapayer. 9tatement & Marge tapayers are not re$uired to %le their returns online through the 'D@s electronic %ling and payment system /e>(90 facility. 9tatement :& 9ales to (;PA-registered enes are generally treated as ta-eempt sales. a. True, True, True b. >alse, True, >alse c. >alse, >alse, True '. T%"e alse alse
4.
"hich of the following statements is)are not correct# Statement 1: The income ta returns /DT@s0 of tapayers which ha!e adopted funconal currency /other than (hilippine peso0 in their %nancial statements and books of accounts shall be prepared using the adopted funconal currency. Statement 2: >or purposes of translang the funconal currency income and epenses to (hilippine (esos, the translaon shall be done on a $uarterly basis using the a!erage echange rate during the $uarter /under the (hilippine 2ealing 9ystem or (290. Statement 3: All ta returns other than the DT@ shall be %led in (hilippine peso currency using historical peso amount or actual con!ersion)pre!ailing (29 rate on transacon day, whiche!er is applicable. Statement 4: Ta credits applied against the income ta due /in (hilippine pesos0, if any, shall be e$ual to the actual amounts of such credits in (hilippine pesos, as shown in the supporng documents /e.g. withholding ta cer%cates issued by the other party withholding agents, proof of ad!ance payment of the ta and prior yearYs income ta return0. Statement 5: 1nly the unaudited %nancial statements in the $uali%ed funconal currency shall be submiUed to the 'D@. a. 9tatements 4, , and : only b. 9tatements :, 8, and + only $.
0.
3rey "orm 7ompany, a VAT registered enty, purchased in the beginning of 7J 48, a deli!ery from a VATregistered dealer of automobiles. 2ue to recent ooding, the only record)document a!ailable related to the said purchase was an oCcial receipt with an amount of ( 4,48+,+ /inclusi!e of VAT of ( 4:,<80. How much would be the depreciaon epense that can be claimed as deducble epense in 7J 48 if the e$uipment has useful life of 8 years# a. , 23340 b. ( +F, c. (
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