EXAMINATION FINALS
INSTRUCTION: IN YOUR ANSWER SHEET, SHADE THE LETTER THAT
CORRESPONDS TO THE BEST ANSWER. ANSWER WITH ERASURE
WILL BE INVALIDATED. (TOTAL POINTS = 100 POINTS)
I. THEORY (1 point each = 50 points)
1. Which of the following is not a local tax?
a. Community tax
b. Professional receipt tax
c. Documentary stamp tax
d. Real property tax
2. Which of the following does not describe the nature of the
Philippine Internal Revenue Laws? The 1997 NIRC is
a. civil in nature but not penal in nature because taxes are
obligations created by law and not by violation of laws.
b. part of remedial law to protect rights, and prevent or
rectify wrong doings such tax evasion.
c. not political in nature because taxes are paid not to
occupying enemy.
d. a special law that takes precedence over Civil Code or
Rules of Court.
3. The following statements are true. Which is the exception?
a. Tax exemption should be construed in strictissimi juris
against the taxpayer.
b. Tax laws are liberally to be construed in favor of the
taxpayer and strictly against the government.
c. Taxation is a destructive power because it interferes
with the personal and property rights of the people and
taxes from them a portion of their property for the
support of the government.
d. Revenue laws are liberally to be construed in favor of
the government because the power of taxation is a high
prerogative of sovereignty.
4. It refers to the power of the BIR Commissioner (1st par. Sec.
206, NIRC) to place under constructive distraint the property
of the delinquent taxpayer, or of any taxpayer who, in his
opinion, performs any act tending to obstruct the proceeding
for collecting the tax due or which may be due him.
a. Preventive embargo
b. Jeopardy assessment
c. Confiscation of real property
d. Boycott of goods
5. The taxpayer is suspected to have declared incorrect gross
income in his 2012 ITR. The tax examiner requested the BIR
Commissioner to authorize him to inquire into the bank
deposits of the taxpayer so that he could proceed with the
net worth method of investigation to establish fraud. Which
of the following is incorrect?
a. The BIR Commissioner can authorize the tax examiner to
inquire into the bank deposits of the taxpayer under
investigation.
b. The taxpayer can invoke the Bank Deposit Secrecy Law.
c. The BIR Commissioner is authorized to inquire into bank
deposit if the taxpayer applied for tax compromise due
to financial incapability to pay his tax liability.
d. The BIR Commissioner is authorized to inquire into bank
deposit if the taxpayer dies to determine his gross
estate.
6. Pepe and Pilar were legally separated. The Court awarded
custody of their six minor qualified dependent children as
follows: two for Pepe, three for Pilar and one for the Father
of Pepe. Assuming that Pepe is directed by Court to provide
full support to his six children because he is the only one
gainfully employed, how many children can he claim as
additional exemption?
1
a. Six children
b. Four children
c. Three children
d. Two children
7. Which among the following concepts of taxation is the basis
for the situs of income taxation?
a. Revenue purpose
b. Sumptuary purpose
c. Compensatory purpose
d. Symbiotic relation
8. Which of the following reduces the distributable estate to the
heirs?
a. Vanishing deduction
b. Standard deduction of P1 million
c. Transfer for public use
d. Exclusive property of the surviving spouse
9. Don Nato, a widower, died in May, 2012. In his will, he left his
estate of P100 million to his four children. He named his
compadre, Don Tacio, to be the executor of the estate. When
the BIR sent a demand letter to Don Tacio for the payment of
the estate tax, he refused to pay claiming that he did not
benefit from the estate, he not being an heir. Forthwith, he
resigned as executor. As a result of the resignation, who may
be held liable for the payment of the estate tax?
a. Don Tacio since the tax became due prior to his
resignation.
b. The eldest child who would be reimbursed by the others.
c. All the four children, the tax to be divided equally among
them.
d. The person designated by the will as the one liable.
10. Who has the primary liability for the payment of estate tax?
a. The estate.
b. The decedent
c. The executor or administrator
d. The heirs
11. Which of the following is not a requirement for estate tax
purposes?
a. New TIN of the estate
b. CPA Certificate if the gross estate is P2,000,000 and
below.
c. Notice of death within two months when the gross
estate exceeds P20,000.
d. Estate tax return within 6 months when the gross estate
exceeds P200,000.
12. In March 2011, Tonette, who is fond of jewelries, bought a
diamond ring for P750,000.00, a bracelet for P250,000.00, a
necklace for P500,000.00, and a brooch for P500,000.00.
Tonette derives income from the exercise of her profession as
a licensed CPA. In October 2011, Tonette sold her diamond
ring, bracelet, and necklace for only P1.25 million incurring a
loss of P250,000.00. She used the P1.25 million to buy a solo
diamond ring in November 2011 which she sold for P1.5
million in September 2012. Tonette had no other transaction
in jewelry in 2012. Which among the following describes the
tax implications arising from the above transactions?
a. Tonette may deduct his 2011 loss only from her 2011
professional income.
b. Tonette may carry over and deduct her 2011 loss only
from her 2012 gain.
c. Tonette may carry over and deduct her 2011 loss from
her 2012 professional income as well as from her gain.
d. Tonette may not deduct her 2011 loss from both her
2012 professional income and her gain
 EXAMINATION FINALS
13. Shine Realty Co. sold a residential house and lot at a selling a. donatio inter-vivos
price of P3,000,000. The real property, however, has a BIR b. donatio mortis-causa
Zonal Value of P4,000,000 at the time of sale. Which of the c. donatio ab initio
following is not true? d. donatio de-facto
a. The difference between the sales price and zonal value is
subject to donor’s tax. 22. The following items are included as part of the gross estate,
b. The sale of real property is subject to 12% VAT because except:
the zonal value exceeds P3,199,200. a. irrevocable trust.
c. Since the selling price is lower than P3,199,200, the sale b. Claims against insolvent persons.
of residential house and lot is VAT-exempt. c. Proceeds of life insurance with revocable beneficiary.
d. The sale price is subject to creditable withholding tax of d. Exclusive property of the decedent.
5%.
23. Which of the following last Will and Testament is not valid?
14. The basic community tax for a partnership business is a. Holographic will written in the very hand-writing of the
a. None testator
b. P 5.00 b. Notarial will signed by the testator in every page,
c. P 500.00 notarized by a lawyer in the presence of at least three
d. P2,000.00 witnesses
c. Oral will in the presence of credible witnesses
15. To avoid penalty, the payment of community tax for those d. Codicil to explain the original will
who already paid the same tax in the previous should be
made on or before 24. If the investments in common shares of stock made by the
a. January 1 of the current year. decedent are not traded-in the stock market, the value to be
b. The last day of February of the current year. reported in the estate tax return should be
c. March 31 of the current year. a. the actual sales price at the time of liquidation.
d. Twenty days from the date the taxpayer becomes liable. b. Stockholders’ equity at the time of death divided by the
outstanding common shares.
16. What is the amount of maximum additional community tax c. Par value of the common shares.
for an individual taxpayer? d. Liquidating value of the common shares.
a. P 500
b. P 2,000 25. The following proceeds of life insurance is exempt from
c. P 5,000 estate tax, except:
d. P10,000 a. With irrevocable third person beneficiary.
b. With benefits from SSS and GSIS.
17. One of the following establishments is classified as large c. With proceeds from group insurance.
taxpayer. d. With administrator as beneficiary.
a. With VAT payable of at least P100,000 in any quarter of
the previous year 26. Which of the following is not classified as ordinary deduction?
b. With withholding tax remittance of at least P100,000 in a. Vanishing deduction
any quarter of the previous year b. Transfer for public use
c. With income tax payable of P100,000 of the previous c. Medical expense
taxable year d. Unpaid mortgage of property inherited by the decedent
d. With excise tax payment of at P100,000 per quarter in prior to his death
the previous taxable year
27. This property valuation is generally used in determining the
18. Which of the following taxes is not a transfer tax? value of the distributable estate.
a. Excise tax a. Selling price
b. Estate tax b. Fair market value.
c. Donor’s tax c. Zonal value.
d. All of the above d. Realizable value.

19. Which of the following due dates is not true? 28. This substantiated expense is allowed to reduce the gross
Particular Due date estate even if already paid prior to the decedent’s death,
a. Annual filing ITR April 15 of the following year except
b. Estate tax return Within six months from the a. Medical expense
time of death b. Funeral expense
c. Donor’s tax Within 30 days from the c. Income tax expense
time of donation d. All of the above
d. Monthly VAT 25 days after the month of
return sale 29. This item of charges shall reduce the community property of
the decedent.
20. Gerardo died on July 31, 2011. His estate tax return should be a. Liability incurred by either spouse by reason of a crime.
filed within b. Gambling losses sustained by either of the spouse.
a. six months from filing of the notice of death. c. Unpaid mortgage loan of an inherited property received
b. sixty days from the appointment of an administrator. by the decedent during marriage time.
c. six months from the time he died on July 31, 2011. d. Unpaid mortgage loan incurred by the spouses during
d. sixty days from the time he died on July 31, 2011. marriage time using the exclusive property of the
surviving spouse as collateral.
21. This refers to a gift made during the life-time of the donor
which is conditional upon and takes effect upon death.

2
 EXAMINATION FINALS
30. This deduction is allowed to reduce the gross estate of a
nonresident alien decedent without properties outside the
Philippines.
a. Standard deduction
b. Donation to the Philippine Government
c. Funeral expense
d. Medical expense
31. The special deductions deductible from gross conjugal estate
would be:
a. Standard deduction
b. Family home
c. Judicial expense
d. None of the above
32. Which of the following deductions from gross estate is not
subject to limit?
a. Funeral expense
b. Medical expense
c. Claims against the estate
d. Family home
33. The standard deduction of P1,000,000 from gross estate is:
a. optional.
b. in addition to ordinary deduction.
c. not available to nonresident Filipino decedents.
d. in lieu of all ordinary deductions.
34. How much is the share of the decedent’s legitimate parents
when his surviving relatives are his adopted son, surviving
spouse and a sister. The decedent died without a will.
a. None
b. 50% of the net distributable estate
c. 25% of the net distributable estate
d. 20% of the net distributable estate
35. Celia donated P110,000.00 to her friend Victoria who was
getting married. Celia gave no other gift during the calendar
year. What is the donor's tax implication on Celia’s donation?
a. The P100,000.00 portion of the donation is exempt since
given in consideration of marriage.
b. A P10,000.00 portion of the donation is exempt being a
donation in consideration of marriage.
c. Celia shall pay a 30% donor's tax on the P110,000.00
donation.
d. The P100,000.00 portion of the donation is exempt
under the rate schedule for donor's tax.
36. In May 2010, Mr. And Mrs. Melencio Antonio donated a
conjugal house and lot with a fair market value of P10 Million
to their son, Roberto, and daughter-in-law, Josefina, who
were just married during the year. Which statement below is
INCORRECT?
a. There are four (4) donations made – two (2) donations
are made by Mr. Melencio Antonio to Roberto and
Josefina, and two (2) donations are made by Mrs.
Antonio;
b. The four (4) donations are made by the Spouses Antonio
to members of the family, hence, subject to the
graduated donor’s tax rates (2%-15%);
c. Two (2) donations are made by the spouses to members
of the family, while two (2) other donations are made to
strangers;
d. Two (2) donations made by the spouses to Roberto are
entitled to deduction from the gross gift as
donation proper nuptias.
37. Levox Corporation wanted to donate P5 million as prize
money for the world professional billiard championship to be
held in the Philippines. Since the Billiard Sports Confederation
3
of the Philippines does not recognize the event, it was held
under the auspices of the International Professional Billiards
Association, Inc. Is Levox subject to the donor's tax on its
donation?
a. No, so long as the donated money goes directly to the
winners and not through the association.
b. Yes, since the national sports association for billiards
does not sanction the event.
c. No, because it is donated as prize for an international
competition under the billiards association.
d. Yes, but only that part that exceeds the first P100,000.00
of total Levox donations for the calendar year.
38. Which of the following tax is not paid on casual sale of real
property?
a. Local transfer tax
b. Capital gains tax
c. Income tax
d. Documentary stamp tax
39. This tax is imposed on sale, barter or exchange of goods and
services, transactions deemed sale and importation of goods
and services.
a. Value-added tax
b. Other percentage tax
c. Excise tax
d. Transfer tax
40. The following are subject to 3% common carriers tax, except:
a. motor tricycles.
b. Jeepney operators.
c. Tourist buses.
d. common carriers transporting cargoes.
41. A pawnshop shall now be treated, for business tax purposes:
a. As a lending investor liable to the 12% VAT on its gross
receipts from interest income and from gross selling
price from sale of unclaimed properties;
b. Not as a lending investor, but liable to the 5% gross
receipts tax imposed on a non-bank financial
intermediary under Title VI (Other Percentage Taxes);
c. As exempt from 12% VAT and 5% gross receipts tax;
d. As liable to the 12% VAT and 5% gross receipts tax.
42. The public market vendor below, who is not a VAT-registered
person is liable to VAT in 2010, if:
a. She sells raw chicken and meats and her gross sales
during the year amount to P3 Million;
b. She sells vegetables and fruits in her stall and her gross
sales during the year amount to P4 Million;
c. She sells flowers and plants in her stall and her gross
sales during the year amount to P2.2 Million;
d. She sells live fish, shrimps, and crabs and her gross sales
during the year amount to P5 Million.
43. Which statement is FALSE under the VAT law?
a. A VAT-registered person will be subject to VAT for his
taxable transactions, regardless of his gross sales or
receipts.
b. A person engaged in trade or business selling taxable
goods or services must register as a VAT person, when
his gross sales or receipts for the year 2013 exceed
P1,919,500.
c. A person who issued a VAT-registered invoice or receipt
for a VAT-exempt transaction is liable to the 12% VAT as
a penalty for the wrong issuance thereof.
d. Once a doctor of medicine exercises his profession
during the year, he needs to register as a VAT person
and to issue VAT receipts for professional fees received.
 EXAMINATION FINALS
44. ABS Corporation is a PEZA-registered export enterprise which
manufactures cameras and sells all its finished products
abroad. Which statement is NOT correct?
a. ABS Corporation is subject to the 5% final tax on gross
income earned, in lieu of all national and local taxes;
b. ABS Corporation is exempt from the 30% corporate
income tax on net income, provided it pays 12% output
VAT;
c. ABS Corporation is subject to the 0% output VAT;
d. ABS Corporation is exempt from all national and local
taxes, except real property tax.
45. Sale of residential house and lot by an official of a domestic
corporation to another official in the same corporation for a
consideration of P3.0 Million in 2012 is:
a. Exempt from VAT because the gross sales do not exceed
P3,199,200 Million.
b. Exempt from VAT because the property sold is a capital
asset, regardless of the gross selling price.
c. Exempt from VAT because the seller is not a person
engaged in real estate business.
d. Taxable at 12% VAT output tax on the gross selling price
of P3.0 Million.
46. Which of the following input VAT of a VAT-registered
taxpayer is not allowed to be converted into tax credit
certificate?
a. Input VAT of zero-rated sales
b. Input VAT of effectively zero-rated sales
c. Input VAT of imported or local purchases of capital
goods
d. Input VAT of those VAT-registered taxpayers who would
be cancelling their VAT-registration
47. Under the VAT system, there is no cascading because the tax
itself is not again being taxed. However, in determining the
tax base on sale of taxable goods under the VAT system:
a. The professional tax paid by the professional is included
in gross receipts;
b. The other percentage tax (e.g., gross receipts tax) paid
by the taxpayer is included in gross selling price;
c. The excise tax paid by the taxpayer before withdrawal of
the goods from the place of production or from customs
custody is included in the VAT taxable base;
d. The documentary stamp tax paid by the taxpayer is
included in the gross selling price or gross receipts.
48. Except for one transaction, the rest are exempt from value
added tax. Which one is VAT taxable?
a. Sales of chicken by a farmer and whose gross annual
sales amount to P5 Million
b. Sales of copra by a copra dealer whose gross annual
sales is P5 Million
c. Gross receipts of a non-VAT registered CPA during the
year amounted to P2.5 Million
d. Gross receipts of an agricultural contract grower
amounting to P3.0 Millon
49. A lessor or real property is exempt from value-added tax in
one of the transactions below. Which one is it?
a. Lessor leases commercial stalls located in the Greenhills
Commercial Center to VAT-registered sellers of cell
phones; lessor’s gross rental during the year amounted
to P12 Million;
b. Lessor leases residential apartment units to individual
tenants for P12,800.00 per month per unit; his gross
rental income during the year amounted to P6 Million;
c. Lessor leases commercial stalls at P10,000.00 per stall
per month and residential units at P15,000.00 per unit
4
per month; his gross rental income during the year
amounted to P3 Million;
d. Lessor leases two (2) residential houses and lots at
P50,000.00 per month per unit, but he registered as a
VAT person.
50. Which transaction below is subject to VAT?
a. Sale of vegetables by a farmer in Baguio City to a
vegetable dealer;
b. Sale of vegetables by a vegetable dealer in Baguio City to
another vegetable dealer in Quezon City;
c. Sale of vegetables by the QC vegetable dealer to a
restaurant in Manila;
d. Sale of vegetables by the restaurant operator to its
customers.
II. COMPUTATION (2 points each = 50 points)
51. Fred Cruz sold his family home for P5,000,000. The zonal value
of the real property at the time of sale is P6,000,000. How
much is the total amount of national tax to be imposed on the
sale?
a. P300,000
b. P360,000
c. P375,000
d. P450,000
52. American Airlines, an international carrier of foreign registry,
showed the following gross receipts during the taxable year:
Continuous flight from Manila to Beijing
(1,000 tickets at P3,000 per ticket) P3,000,000
Direct flight from Manila to Hong Kong
(3,000 tickets at P2,000 per ticket) 6,000,000
Direct flight from Manila to Hong Kong and
transfer flight from Hong Kong to Beijing
(500 tickets at P3,000 per ticket) 1,500,000
Operating expenses 4,500,000
How much is the total amount of national taxes to be collected
by the BIR from the American Airlines?
a. P250,000
b. P300,000
c. P550,000
d. P2,400,000
53. Rose Bud received a total compensation income in 2012
amounting to P360,000 plus 13th month pay of P30,000 and
other productive bonuses of P10,000. How much is the
amount of her community tax for year 2013?
a. P405.00
b. P395.00
c. P365.00
d. None, because Rose has not yet earned compensation
income in 2013.
54. Texas Instrument is a PEZA-registered multi-national
corporation subject to a final tax of 5% tax. Its total sales during
the year amounting to P50,000,000 and its operating expenses
amounted to P10,000,000. How much is the community tax of
Texas Instrument?
a. P10,500
b. P10,000
c. P 8,500
d. P - 0 -
55. The administrator of X, a decedent resident Filipino citizen,
shows the following gross estate including unpaid expenses
and obligations:
 EXAMINATION FINALS
Gross estate P3,000,000 60. Nor Korea, a nonresident Korean national, died in the
Funeral expenses 200,000 Philippines. His administrator showed to the Philippine
Medical expenses (within one year) 650,000 Government the following assets and expenses:
Claims against the estate 300,000 Within Without
Properties P5,000,000
How much is the amount that shall no longer be allowed as Funeral expenses 300,000
deduction from the gross estate and cannot be classified as Mortgage loan P200,000
claims against the estate? Claims against estate 500,000
a. P150,000
b. P200,000 How much is the net estate subject to estate tax in the
c. P300,000 Philippines?
d. P500,000 a. P5,000,000
b. P4,700,000
56. The only item included in the gross estate is a real property c. P4,000,000
inherited by the present decedent more than 2 years prior to d. P3,000,000
his death. The real property was taxed in the previous transfer
at value of P1,000,000. The present value of the same property 61. The net taxable estate is P10,000,000 subject to estate tax of
at date of death of the present decedent is P3,000,000. The P1,215,000. The decedent is a resident Filipino with conjugal
total actual and ordinary deductions from the gross estate is family home of P2,000,000, actual medical expense unpaid of
P150,000. How much could be allowed as the amount of P400,000 and funeral expense of P100,000. How much is the
vanishing deduction? net distributable estate?
a. P 570,000 a. P10,785,000
b. P 720,000 b. P11,185,000
c. P 950,000 c. P11,285,000
d. P1,710,000 d. P12,185,000

57. While he was traveling with friends, Mr. Jose Francisco, 62. Monie Weather, a resident alien died leaving conjugal
resident Filipino citizen, died on January 20, 2012 in a properties within and outside the Philippines to his wife,
California Hospital, USA, leaving personal and real properties Junkie as follows:
with market values as follows: House and Lot in Quezon City – Within Without
P10 Million; Cash in bank in California – US$10,000.00; Family home P5,000,000 P10,000,000
Citibank in New York – US$5,000.00; Cash in BPI Makati – P4 Car 4,000,000 6,000,000
Million; Car in Quezon City – P1 Million; Shares of stocks of Cash 3,000,000 4,000,000
Apple Corporation, US corporation listed in NY Stock Funeral expense 300,000 700,000
Exchange US$9,500.00. Exchange rate is US$1 = Php50. If the Judicial expense 500,000 1,000,000
US Government grants tax-exempt reciprocity to Filipino Medical expense – paid 40,000 260,000
citizens, Mr. Francisco’s gross estate for the Philippine estate Claims against insolvent 2,000,000 1,000,000
tax purposes shall be: person
a. P13,000,000. Estate tax paid 1,115,000
b. P14,000,000.
c. P15,000,000. How much is the estate tax still due and payable in the
d. P16,000,000. Philippines if the estate tax of the first P10,000,000 net taxable
estate is P1,215,000 and the excess is subject to 20%?
58. The parents of a student (minor) who died in a tourist bus and a. P637,500
truck collision in Tuba, Benguet received a total amount of b. P670,000
P2,500,000 of which P500,000 comes from the tourist bus c. P700,000
company and P2,000,000 from the proceeds of a revocable life d. P800,000
insurance. The P2,000,000 was received 30 days after death.
The P500,000 was received after an out-of-court settlement 63. On March 1, 2012, Don and Dona gave a car as a gift to their
negotiation was made by the tourist bus company. How much son purchased at P1,000,000 on account of graduation. On
is the amount to be declared in the estate tax return? August 1, 2012, the couple went to the BIR to pay the donor’s
a. P2,500,000 tax to legalize the transfer of the car in the name of their son.
b. P2,000,000 How much is the total amount to be collected by the BIR?
c. Zero, because the amounts were received after death. a. P28,000
d. Zero, because the decedent person is a minor. b. P44,000
c. P37,800
59. Jose Ramos, single, died of a heart attack on October 10, d. P59,400
2012, leaving a residential house and lot (family home) with a
market value of P2.2 Million and cash of P100,000.00. Mr 64. On January 10, 2012, Maria Reyes, single-mother, donated
Ramos already paid 3 memorial plans prior to his death cash in the amount of P50,000.00 to her daughter Cristina,
amounted to P300,000.00. and on December 20, 2012, she donated another P50,000.00
a. His estate is exempt from estate tax because the net to Cristina. Which statement is correct?
estate is zero. a. Maria Reyes is subject to donor’s tax in 2012 because
b. His estate is subject to estate tax because the net estate the gross gift is P100,000.00;
is P470,000. b. Maria Reyes is exempt from donor’s tax in 2012 because
c. His estate is subject to estate tax because the net estate the gross gift is P100,000.00;
is P500,000. c. Maria Reyes is exempt from donor’s tax in 2012 only to
d. His estate is subject to estate tax because the net estate the extent of P50,000.00;
is P1,500,000. d. Maria Reyes is exempt from donor’s tax in 2012 because
the donee is minor.

5
 EXAMINATION FINALS
65. Conjugal donations by Mr. and Mrs. Bigay were made as 69. DC Realty sold a house and lot to Manny for a contract price
follows: of P10,000,000 plus VAT with the following terms of
 February 14, 2013 – house and lot with acquisition cost of payment:
P1,000,000 (FMV of P1,400,000) to their only son, Anak, Year Particulars Amount
on account of marriage. The property was subject to a 1 Down payment P2,500,000
mortgage of P400,000 which is not assumed by the 2 First installment 3,750,000
donee. 3 Second installment 3,750,000
 June 14, 2013 – cash P200,000 to their only son, Anak, and The contract stipulates that if the buyer fails to pay on time, a
jewelry P100,000 to their daughter-in-law, on account of surcharge of 5% and interest of 12% per annum shall be
marriage. imposed on the buyer.

How much is the amount of net gifts subject to graduated Assuming that Manny was 3 months late in paying the second
donor’s tax on June 14, 2013? installment, how much is the amount of VAT collectible from
Mr. Bigay Mrs. Bigay the buyer?
a. P790,000 P790,000 a. P450,000
b. P630,000 P630,000 b. P486,000
c. P140,000 P140,000 c. P637,500
d. P100,000 P100,000 d. P900,000

66. MC Trading reported the following during the year 2012: 70. During the quarter, a VAT-registered business reported the
January to September: following:
Sales P1,900,000 Gross sales:
Percentage tax payment 57,000 Cash sales P 500,000
On October 2012, MC registered under VAT system with Credit sales 800,000
beginning inventory amounting to P500,000. The actual input Sales returns 100,000
VAT related to the said inventory was P9,000. Sales and Sales discounts due to prompt payment 50,000
purchases related to VAT operation from October to Goods used for promotion 40,000
December 31, 2012 were as follows: Sale of obsolete inventories 60,000
Consigned goods (unsold after 60 days) 100,000
Purchases, including VAT P1,120,000
Sales, including VAT 896,000 How much is the Output VAT for the quarter?
a. P138,000
How much is the VAT payable at the end of the year? b. P150,000
a. P185,000 c. P157,200
b. P148,000 d. P163,200
c. P137,000
d. (P33,000) 71. Sultan Realty Co. (a VAT-registered) sold the following real
property to Mr. Kiram:
67. Campus Furniture, Inc., a VAT-registered business, reported Square Sales price, BIR Zonal
the following results of operation during the quarter: Real properties: meters including VAT Value
Sales to regular customers P3,000,000 Residential lot 300 3,360,000 P4,000,000
Export sales 1,000,000 House and lot 200 5,600,000 4,200,000
Sales to government 1,000,000
Purchases, inclusive of VAT 3,360,000 If Sultan Realty has input VAT amounting to P180,000, how
Operating expenses, including VAT 560,000 much is the net VAT payable of the said sale of real
Cost of sale 2,800,000 properties?
a. P960,000
How much is the VAT payable during the quarter?
b. P900,000
a. P 24,000
c. P804,000
b. P108,000
d. P780,000
c. P144,000
d. P228,000
72. Baguio Water District obtained water franchise from the
68. Philippine Airlines (PAL) transports passengers within and Philippine Government to supply water to Baguio City. Its total
outside the Philippines. PAL reported the following gross gross receipts during the amounted to P11,200,000 inclusive
receipts during the taxable year: of VAT. How much is the total amount of business taxes
Gross receipts from including surcharges to be imposed to Baguio Water District?
transport of Within Without a. P 300,000
Passengers P20,000,000 P15,000,000 b. P1,200,000
Cargoes 10,000,000 5,000,000 c. P2,000,000
d. P2,100,000
If PAL has a total input VAT of P2,400,000 for its entire
operation within and outside the Philippines, how much is the 73. Assume the following information relating to the business
net VAT payable? activities of X, a VAT-registered business:
a. P3,600,000 January February March
b. P2,640,000 Sales before VAT P1,000,000 P1,300,000 P1,500,000
c. P2,260,000 Purchases, inclusive of VAT:
d. P1,200,000 Goods for sale 672,000 784,000 896,000
Capital goods 1,344,000 560,000
(useful life is 4 years)

The net VAT payable for the month of March would be

6
 EXAMINATION FINALS
a. P84,000
b. P81,600
c. P81,000
d. P21,000

74. Star Plan, Inc., a VAT-registered pre-need company, showed

the following reports during the taxable year:
Gross Contribution
receipts to trust fund
Educational plan P10,000,000 P4,000,000
Pension plan 8,000,000 3,000,000
Life and memorial plan 7,000,000 3,000,000

How much is the amount of output VAT assuming that the

gross receipts are VAT exclusive?
a. P3,000,000
b. P1,800,000
c. P1,250,000
d. P 750,000

75. Mang Kepweng shows his transport transactions using

primitive vehicles to transport people and cargoes during the
quarter:
Gross receipts:
5 Kalesa (horse drawn) P150,000
6 Cariton (carabao drawn) 120,000
8 Bancas (man drawn) 80,000
Operating expenses 50,000

How much is the total amount of business tax that can be

collected from Mang Kepweng?
a. P - 0 -
b. P10,500
c. P42,000
d. P50,000

End of Examination