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a. Domestic consumption
b. Foreign consumption
a. Savings tax
b. Investment tax
c. Consumption tax
d. Business tax
c. Apply only when the goods or services are destined for consumption within the Philippines.
d. Consumption taxes may encourage savings formation.
a. A non-resident
b. A resident
a. VAT on importation
b. Business tax
c. Either A or B
d. Neither A or B
a. VAT on importation
b. Business tax
c. Either A or B
d. Neither A or B
11. The tax on domestic consumption from resident suppliers is
a. VAT on importation
b. Business tax
c. Either A or B
d. Neither A or B
a. VAT on importation
b. VAT on sales
c. Percentage tax
d. Excise tax
a. 3% of sales or receipts
b. 3% of purchases
c. 3% of mark-up
d. 12% of mark-up
b. 12% of purchases
c. 12% of mark-up
d. 3% of mark-up
a. 12% of sales
b. 12% of purchases
c. 12% of mark-up
d. 3% of mark-up
b. Sales to non-resident.
a. Direct tax
b. Indirect tax
c. Ad valorem tax
d. Specific tax
c. Both A and B
d. Neither A nor B
c. Both A or B
d. Neither A nor B
a. Foreign seller
b. Domestic buyer
c. Both A and B
d. None of these
a. Sales or receipts
b. Purchase cost
c. Either A or B
d. Both A and B
4. What is the method used to determine the VAT due and payable?
a. Direct method
b. Indirect method
d. Withholding method
a. The buyer pays the consumption tax with its purchase to the seller.
6. Which is correct?
a. The sales to foreigners must include a business tax.
d. All of these.
a. Percentage tax
c. Input VAT
d. VAT on importation
a. Percentage of tax
c. Both A and B
d. Neither A nor B
9. Statement 1: A business which pays VAT normally does not pay percentage tax.
a. Statement 1
b. Statement 2
c. Both statements.
d. Neither statement.
10. Which of the following business taxes applies only for domestic consumption?
a. VAT on sales
b. Percentage tax
c. Excise tax
d. All of these
a. Sellers
b. Buyers
c. Importers or manufacturers.
d. All of these.
13. Statement 1: Excise tax is always paid together with VAT or percentage tax.
a. Statement 1
b. Statement 2
c. Both statements.
d. Neither statement.
b. Non-essential commodities.
c. Food products.
d. Mineral products.
a. Sales or receipts.
b. Purchase costs
c. Either A or B
d. Both A and B
a. Sales or receipts
b. Purchase costs
c. Either A or B
d. Both A and B
18. Technically, the excise tax on the manufacture of certain articles is payable only when the articles is
intended for
a. Domestic consumption
b. Foreign consumption
c. Both A and B
d. Neither A nor B
a. A direct tax
b. An indirect tax
c. A regulatory tax
d. A specific tax
1. Free Company, a resident business, renders services to Mr. Erlwin, a resident person who is not
engaged in business.
a. Free Company
b. Mr. Erlwin
c. Both A and B
d. Neither A nor B
2. Baliwag Company, a non-resident business, purchased P200,000 from Cauayan Company, a resident
business. Which will pay the consumption tax on this transaction?
a. Cauayan Company
b. Baliwag Company
c. Both A and B
d. Neither A nor B
3. Heidenberg Corporation, a resident business, purchased P100,000 goods from Kiwi Company, a non
resident business. Which will pay the consumption tax on this transaction?
a. Heidenberg Corporation
b. Kiwi Company
c. Both A and B
d. Neither A nor B
4. Mr. Cedric, an employee, sold his residential lot to Mrs. Corneto, a real property dealer. Which is
subject to consumption tax with respect to this transaction?
a. Mr. Cedric
b. Mrs. Corneto
c. A and B
d. Neither A nor B
5. Mr. Bangus made a casual sale involving a car to Mrs. Tulya, a resident buyer. Mr. Bangus is not a car
dealer. Which is subject to consumption tax?
a. Mr. Bangus
b. Mrs. Tulya
6. Mr. Cavite produces an excisable article for sale in the Philippines market. Which is incorrect with
respect to Mr. Cavite's business taxation?
c. Mr. Cavite pays excise tax in addition to VAT and percentage tax
d. Mr. Cavite will pay excise tax without regard to whether he is VAT or non-VAT taxpayer.
7. A person engaged in business is subject to 3% business tax. He has inventories if goods in his
possession which costs P77,600 which he intends to sell to earn a mark-up of 25% of cost net of the 3%
business tax.
a. P100,000
b. P103,000
c. P97,000
d. P110,000
8. A business wants to make a P10,000 profit from the sale of an inventory costing P30,000.
The business is subject to 3% percentage tax.
a. P41.237
b. P41,200
c. P40,000
d. P38,800
d. No consumption tax
10. A person who is not regularly engaged trade or business sells made a casual sale of property for
P100,000. What will be the invoice price of the sale?
a. P100,000
b. P103,000
c. P112.000
d. Either B or C
c. Either A or B
d. Neither A nor B
12. Mr. Venturais subject to 3% percentage tax. He made a total collection of P206,000 during a month
and paid P103,000 in purchases. Compute his percentage tax.
a. P0
b. P3,000
c. P6,180
d. P12,000
13. A business taxpayer purchased P120,000 from non-residents and sold goods worth P140,000 for
P180,000.
What is the concept of value added for VAT purposes?
a. P200,000
b. P140,000
c. P80,000
d. P60,000
14. In the immediately preceding problem, what is the basis of percentage tax?
a. P200,000
b. P140,000
c. P120,000
d. P180,000
15. Assuming the same data in the above problem, what is the basis of VAT on importation?
a. P200,000
b. P140,000
c. P120,000
d. P80,000
16. Mr. Coroneti imported P300,000 equipment for business use and a P1,200,000 car for personal use.
What is the amount subject to the VAT on importation?
a. P0
b. P300,000
c. P1,200,000
d. P1,500,000
Basic Case 1
1. A business taxpayer had the following purchase and receipts:
Determine the total amount of which will be subject to consumption tax to the business taxpayer.
a. P500,000
b. P400,000
c. P350,000
d. P340,000
2. In the immediately preceding problem, determine the amount subject to the consumption tax if the
taxpayer is not engaged in business.
a. P490,000
b. P390,000
c. P200,000
d. P190,000
Basic Case 2
3. A VAT-registered taxpayer recorded the following sales and purchases during the month:
Sales P300,000
Purchases P200,000
a. P48,000
b. P36,000
c. P24,000
d. P12,000
b. P36,000
c. P24,000
d. P12,000
a. P36,000
b. P24,000
c. P12,000
d. P0
6. Assuming the taxpayer is a non-VAT taxpayer paying 3% percentage tax, the percentage tax shall be
a. P12,000
b. P9,000
c. P6,000
d. P3,000
Basic Case 3
a. P0
b. P24,000
c. P36,000
d. P42,000
8. Compute the VAT on importation.
a. P0
b. P12,000
c. P18,000
d. P32,000
a. P0
b. P6,000
c. P9,000
d. P10,500
a. P0
b. P3,000
c. P12,000
d. P18,000
Basic Case 4
Sindangan Company, a VAT registered taxpayer, purchased P400,000 worth goods and sold the same for
P800,000.
11. Assuming that the business operation of Sindangan Company is limited to Philippine residents,what is
the total business tax it will report on its sales?
a. P96,000
b. P48,000
c. P24,000
d. P0
12. Assuming that the purchases were import and the sales were exports, compute the business tax and
total consumption tax, respectively:
a. P96,000: P144,000
b. P24,000: P144,000
c. P24,000: P72,000
d. P0: P48,000