Professional Documents
Culture Documents
INSTRUCTIONS: Select the best answer for each of the following questions. ALL questions are compulsory and
MUST be attempted. Mark only one answer for each item on the answer sheet provided. Strictly NO ERASURES
ALLOWED. Erasures will render your examination answer sheet INVALID. Use PENCIL NO. 2 only. GOODLUCK!
The income tax due at the end of the year: 22. An offshore banking unit, already in its 8 th year in the
a. P318,000 c. P43,000 Philippines, has the following data in its income and
b. P63,200 d. P33,000 expenses for the year 2015:
Foreign currency transactions
Next two (2) questions are based on the following: with:
Be Jolly Corporation has the following information for the Non-residents 1,800,000
taxable year 2015: Local banks 1,200,000
Branches of foreign banks 1,000,000
QUARTER RCIT MCIT Creditable Another OBU 500,000
Withholding Other residents (Interest 800,000
Tax Income)
First 200,000 160,000 40,000
Second 240,000 500,000 60,000 Other income:
Third 500,000 150,000 80,000 Rent income 1,000,000
Fourth 300,000 200,000 70,000 Miscellaneous income 500,000
28. Which of the following test of source of income is How much is the taxable income?
incorrect? a. P505,000 c. P535,000
a. Interest income - residence of the debtor b. P525,000 d. P555,000
b. Income from services – place of performance
c. Royalties – place of use of intangible 34. Based on the above problem, but the taxpayer is a
d. Gain on sale of real property – place of sale. corporation, how much is the taxable income?
a. P570,000 c. P560,000
29. Situs of taxation on income from sale shares of a b. P545,000 d. P600,000
domestic corporation.
a. Always treated as income derived from within the 35. BSE College, a proprietary educational institution,
Philippines spent P10 million for the construction of a new school
b. Always treated as income derived from without the building. The amount spent for the construction -
Philippines a. Must be claimed as expense in the year of
c. May be treated as income within or without the completion
Philippines depending on the place of sale b. Capitalized and claim annual depreciation over the
d. May be treated as income within or without the life of the building
Philippines depending where the shares are kept c. Capitalized or expensed outright at the option of
the school
30. Situs of taxation on income from sale shares of a d. Capitalized or expensed outright at the option of
foreign corporation. the BIR
a. Always treated as income derived from within the
Philippines Use the following data for the next two (2) questions:
b. Always treated as income derived from without the Floyd, not a dealer in securities, had the following
Philippines transactions on ordinary shares of JJ Co. (a domestic
c. May be treated as income within or without the corporation) for 2015 taxable year:
Philippines depending on the place of sale Jan. 12 Purchase 100 shares P100,000
d. May be treated as income within or without the June 20 Sold the shares purchased on 80,000
Philippines depending where the shares are kept Jan. 12
June 30 Purchased 70 shares 50,000
31. Joseph provided the following data on sale of his Oct. 15 Sold the shares purchase on 75,000
personal property sold in 2013 held by him for 15 June 30
months:
Cost P225,00 36. How much was the loss on wash sale?
0 a. P20,000 c. P14,000
Mortgage assumed by the buyer 270,000 b. P6,000 d. P0
Installment Collection Schedule:
- 2013 67,500 37. How much was the capital gain on sale of shares on
- 2014 67,500 October 15?
- 2015 45,000 a. P25,000 c. P5,500
b. P11,000 d. P0
How much is the income subject to income tax in
2013, 2014, and 2015? 38. Which of the following is subject to 3% percentage tax
a. P56,250, P33,750 and P22,500, respectively under Section 116 of the Tax Code?
b. P112,500, P67,500 and P45,000, respectively I. Fruit dealer whose gross receipts for the year
c. P225,000, P0 and P0, respectively amounted to P1,200,000 only.
d. None of the choices
II. An individual taxpayer whose gross sales for the c. The P150,000 selling price is subject to stock
year amounted to P100,000. transaction tax of ½ of 1%.
III. School bus operator whose gross receipts for the d. The sale is exempt from business tax
year amounted to P1,919,500
a. I and II only c. All of the above 45. In 2015, ADB Finance purchased debt securities from
b. I and III only d. None of the above various companies (listed) for P100,000. ADB
classified the securities as Trading Securities/FAFVPL
39. The taxpayer is a trader of poultry feeds. Determine under the applicable accounting standards. ADB
his applicable business tax. received interest income from those securities
a. Subject to 12% vat amounting to P20,000. Determine the applicable tax.
b. Vat exempt but subject to 3% OPT under Section a. The P20,000 interest income is subject to normal
116 corporate tax of 30%
c. 12% vat or 3% OPT, at his option b. The P20,000 interest income is subject to 20%
d. Exempt from 12% vat and OPT final tax
c. The P20,000 interest income is subject to 5%
40. In the case of a person whose VAT registration is capital gains tax
cancelled and who becomes liable to the 3% tax on d. The P20,000 interest income is tax exempt
VAT-exempt persons under Section 116 of the tax
code, the tax shall accrue from the date of cancellation 46. JJ wants to procure marine insurance for his vessels
and shall he paid within: from International Aquatic Insurance Co., a non-
a. 10 days after the end of each taxable month resident foreign corporation, through its agent, in the
b. 15 days after the end of each taxable month Philippines. He paid premiums in 2016 amounting to
c. 20 days after the end of each taxable month P5 million. How much is the premiums tax payable on
d. 30 days after the end of each taxable month the transaction?
a. P500,000 c. P200,000
41. Which one of the following percentage taxes is paid on b. P250,000 d. nil
a quarterly basis?
I. Tax on overseas dispatch, message, or 47. Bulwagan ng Katotohana, radio and television
conversation originating from the Philippines broadcasting franchisee, recorded the following gross
II. Amusement taxes and taxes on winnings receipts and expenses during the taxable year:
III. Stock transactions tax Advertising revenue from:
IV. Percentage tax on international carriers Television division P20,000,000
a. I and II only c. I, II and III only Radio division 5,000,000
b. III and IV only d. I, II, III and IV Donation received for calamity 5,000,000
victims
42. In 2015, ADB Finance (domestic corporation) Expenses:
purchased various equity securities from listed Salary 8,000,000
domestic corporations for P100,000. ADB classified Other Operating 7,840,000
the securities as Trading Securities/FAFVPL under the expenses, including VAT
applicable accounting standards. ADB received
P10,000 dividend income from such investments in What is the amount of business tax advantages
2016.. Determine the applicable tax of ADB. (disadvantages) if AB-GMS is VAT-registered?
a. The P10,000 dividend income is subject to normal a. P840,000
corporate tax of 30% b. P1,699,200
b. The P10,000 dividend income is subject to a final c. (P2,250,000)
withholding tax of 10% d. (P1,410,000)
c. The P10,000 dividend income is subject to a final
withholding tax of 20% 48. Statement 1: International air carriers and
d. The dividend income is tax exempt international shipping carriers shall not be subject to
12% value added tax but to 3% common carrier’s tax
43. In 2015, ADB Finance (domestic corporation) based on gross receipts derived from their transport of
purchased various equity securities from listed passengers and goods from Philippines to other
domestic corporations for P100,000. ADB classified countries.
the securities as Trading Securities/FAFVPL under the Statement 2: In cases when the Gross Philippines
applicable accounting standards. ADB sold the shares Billings Tax of 2.5% for international carriers is not
in 2016 for P150,000. Determine the applicable tax. applicable (i.e., tax exempt based on reciprocity or
a. The P50,000 gain is subject to normal corporate treaty), the common carrier’s tax under Section 118 of
tax of 30% the NIRC, as amended, shall still apply.
b. The P50,000 gain is subject to 5% capital gains tax A. B. C. D.
c. The P150,000 selling price is subject to stock Statement 1 True True False False
transaction tax of ½ of 1%. Statement 2 True False True False
d. The sale is exempt from business tax
49. Farmers products (FP) is a buyer and miller of
44. In 2015, ADB Finance purchased equity securities from
agricultural products. During the first quarter, its
ABC Corporation (non-listed) for P100,000. ADB
transactions are recorded as follows:
classified the securities as Available for Sale
Units Cost/kg.
Securities/FAFVOCI under the applicable accounting
Purchase of palay 500,000kg 15
standards. ADB sold the shares in 2016 for P150,000.
Purchase of corn 200,000kg 8
Determine the applicable tax.
Milling of palay of 4,000,000k 2
a. The P50,000 gain is subject to normal corporate
customers g
tax of 30%
Milling corns of customer 3,000,000k 2
b. The P50,000 gain is subject to 5% capital gains tax
g
How much is the VAT payable of FP during the quarter? The value-added tax payable for the month:
a. P1,680,000 c. P384,000 a. P56,060 c. P60,650
b. P1,440,000 d. P0 b. P54,900 d. P63,000
50. Farmer’s foods services (FFS) is an agricultural 54. Sweet Tooth Inc. is a manufacturer of sugar. It has the
contract grower. During the first quarter, its following data for the year 2013 (assume that amount
transactions are recorded as follows: is net of VAT unless otherwise stated):
Service rendered production Fee per pdn
units Sales from Raw Sugar P4,000,00
Hatching and sorting 1,600,000 10/tray 0
of eggs trays Sales from Refined Sugar 6,000,000
Dressing and packing 1,200,000 20/pack Sugar Cane Inventory, 12-31-12 1,500,000
broilers packs Purchases of Sugar Cane 7,000,000
Reforestation with 1,000,000 5/tree Sugar Cane Inventory, 12-31-13 2,500,000
government program trees Purchases from VAT suppliers, 672,000
gross of VAT
FFS conducts production 30 days in a month because How much is the VAT payable?
of the demand of the service. It also runs a canteen for a. P396,800 c. P368,000
its workers and passers-by. The canteen has a total b. P508,800 d. P480,000
sales of P50,000 a day.
Use the following data for the next three questions:
How much is the VAT payables of FFS during the A VAT-registered trader has the following transactions:
quarter? Sales of good to private entities, net of P2,500,000
a. P600,000 c. P135,000 VAT
b. P540,000 d. P0 Purchases of goods sold to private 896,000
entities, gross of 12% VAT
51. Determine the business taxes of the following: Sales to a government owned 1,000,000
I. Lease of residential units with a monthly rental per corporation (GOCC), net of VAT
unit not exceeding P12,800 (regardless aggregate Purchases of goods sold to GOCC, net 700,000
annual gross rentals). of 12% VAT
II. Lease of residential units with a monthly rental per 55. How much is the creditable input tax?
unit exceeding P12,800 but the aggregate of such
a. P166,000 c. P70,000
rentals of during the year do not exceed
b. P96,000 d. P180,000
P1,919,500.
III. Lease of commercial units regardless of monthly
56. How much is the input tax closed to expense
rental per unit.
(income)?
A B C D a. P14,000 c. (P14,000)
I None None None Vat b. P34,000 d. (P34,000)
II OPT OPT OPT Vat
III Vat OPT Vat Vat 57. How much is the VAT payable to the BIR?
a. P404,000 c. P204,000
52. CG Corporation is a vat registered entity with the b. P390,000 d. nil
following data for a taxable month:
Domestic sales P500,000 58. JJ gave gifts to the following persons on his 40th
Transaction deemed sales 500,000 birthday:
Export sales 500,000 A second hand car worth P350,000 to Kaskasero,
Sales to DEF, an export oriented 500,000 his trusted driver. The donation was made orally.
enterprises Since then, the driver had taken possession of the
(2/3 of DEF’s annual output is actually property.
exported) To his Mayordoma, Ms. Mercy, a lot with a
Purchases (invoice cost from vat 224,000 bungalow thereon, The value of the property is
registered entities) P1,200,000. The donation provides that it may be
Purchases (invoice cost from non-vat 100,000 revoked anytime at the pleasure of JJ.
registered entities) His flower shop worth P700,000 to Hardinero, his
gardener. The donation is provided in his will.
The vat payable of CG should be Cash of P50,000 each to his three closest friends.
a. P216,000 c. P156,000
b. P204,000 d. P96,000 How much is the donor's tax due on the above
donations?
53. Mantika Corp., a VAT-registered Corp., is a producer of a. P720,000 c. P100,000
cooking oil from coconut and corn. It had the following b. P45,000 d. P1,000
data for the month of January 2014:
Sales, gross of VAT P784,00 59. Amanda Raya sold her properties to her son on the
0 following prices:
Corn & Coconut, 12-31-12 50,000 Residential house for P100,000
Purchases of Corn & Coconut 330,000 Personal properties for P50,000
Deductions claimed:
The current fair market value on the date of sale was Funeral expenses 575,000
P1,000,000 for the house, and P500,000 for the Judicial expenses 67,500
personal properties. Assuming that you know the facts Donation mortis causa to Quezon City 150,000
as a BIR officer, the correct total tax payable on the government
transaction is – Unpaid mortgage on the farm lot 75,000
Medical expenses (included in the 225,000
a. P12,000 c. None funeral expenses incurred within the 1
b. P72,000 d. P38,000 year period with receipts)
The farm lot was inherited 5 ½ years by the decedent
60. The spouses Esme and Carlisle wanted to donate a before his death with a value then of P575,000 and a
parcel of land to their son Edward who is getting mortgage indebtedness of P150,000.
married in December, 2014. The parcel of land has a
zonal valuation of P420,000.00. What is the most The taxable net estate is:
efficient mode of donating the property? a. P3,757,500 c. P2,757,500
a. The spouses should first donate in 2014 a portion b. P4,982,500 d. P2,672,329
of the property valued at P20,000, then spread
the P400,000 equally for 2015, 2016, 2017 and 64. Jiraiya, non-resident Japanese, died leaving the
2018. following:
b. Spread the donation over a period of 5 years by Exclusive properties, Philippines P560,000
the spouses donating P100,000 each year from Conjugal properties, Philippines 420,000
2014 to 2018. Conjugal properties, Abroad 1,820,000
c. The spouses should each donate a P110,000 Funeral expenses 100,000
portion of the value of the property in 2014 then Judicial expenses 100,500
each should donate P100,000 in 2015. Unpaid expenses 150,500
d. The spouses should each donate a P100,000 Losses: occurring 3 mos. After death 120,000
portion of the value of the property in 2014, and due to fire
another P100,000 each in 2015. Then, in 2016, Donation mortis causa to Makati City 180,000
Esme should donate the remaining P20,000. Hall
Family Home (inc. above), located 1,000,000
61. On July 18, 2014, Mr. Dela Cruz gave a property with a abroad
fair market value of P550,000 to Lester, a legitimate Standard deduction 1,000,000
son, and Jennifer, Lester’s bride, on account of their The taxable net estate is:
marriage celebrated on July 19, 2013. The donor’s tax a. P516,500 c. P1,900,000
payable is: b. P635,150 d. P2,100,000
a. P87,100 c. P84,100
b. P38,000 d. P15,800 65. Expenses not essential in the proper settlement of the
estate but incurred for the individual benefit of the
62. During the current year, Mr. and Mrs. Cabarles, non- heirs, legatees, or devisees are not allowed as “judicial
resident citizens, donated the following: expenses.” Which of the following is not allowed as
Sept. 25: To Leona, a legitimate child, on account of deduction from the gross estate under this category?
marriage last month, a conjugal property I. Attorney's fees paid by the heirs to their respective
located in the Philippines, FMV, P620,000. lawyers arising from conflicting claims are not
deductible as judicial expenses.
To Leo, nephew of Mr. Cabarles, on II. Premiums paid by a judicial administrator on his
account of marriage, a property located in
bond.
USA exclusively owned by him with fair
market value of P150,000 (gift tax in USA, III. Compensation of trustees
P 5,500) a. I only c. I and II only
b. II only d. I, II and III
Oct. 9 : To Leonor, a legitimate child, conjugal
property in the Philippines with fair market The next two (2) questions are based on the data provided
value of P100,000. below:
Mr. J. Chavez died leaving the following properties:
The gift tax payable on the October 9 gift of the Rest house in Cebu, acquired before 6,000,000
husband is: marriage
a. P14,000 c. P500 Income from rest house in Cebu 600,000
b. P1,800 d. P4,200 Condominium in Davao, brought to 3,600,000
marriage by wife
63. Mr. Nakalimot Huminga, head of family died on Income from condominium in Davao 360,000
January 15, 2013, leaving the following properties and Town house in Quezon City, acquired 10,500,000
obligations: during marriage
Cash in bank, 50%, donated mortis P300,000 Income from town house in Quezon City 1,050,000
causa to Nat’l Govt;50-% to Q.C. Car, inherited by wife during marriage 1,300,000
gov’t (the testator provided in his Will that it
House and lot in Makati, F. Home 1,500,000 shall form part of the common properties
Personal properties 1,500,000 of the spouses)
Farm lot 825,000 Jewelry, acquired during marriage for 200,000
Claim against an insolvent debtor 225,000 exclusive use of the wife
Transfer in contemplation of death 1,500,000
(gratuitous) 66. How much is the conjugal properties under Conjugal
Transfer passing under special power of 75,000 Partnership of Gains?
appointment a. P12,510,000 c. P18,510,000
b. P22,310,000 d. P23,610,000
Over But not over The tax shall be Plus Of the excess over
- P100T Exempt
P100T 200T 0 2% P100T
200T 500T 2,000 4% 200T
500T 1M 14,000 6% 500T
1M 3M 44,000 8% 1M
3M 5M 204,000 10% 3M
5M 10M 404,000 12% 5M
10M 1,004,000 15% 10M
Over But Not Over The Tax Shall be Plus Of the Excess Over
P 200,000 Exempt
P 200,000 500,000 0 5% P 200,000
500,000 2,000,000 P 15,000 8% 500,000
2,000,000 5,000,000 135,000 11% 2,000,000
5,000,000 10,000,000 465,000 15% 5,000,000
10,000,000 And Over 1,215,000 20% 10,000,000
Over But not over The Tax Shall be Plus Of excess over
10,000 - 5% -
10,000 30,000 500 10% 10,000
30,000 70,000 2,500 15% 30,000
70,000 140,000 8,500 20% 70,000
140,000 250,000 22,500 25% 140,000
250,000 500,000 50,000 30% 250,000
500,000 - 125,000 32% 500,000
- end -