UCP :TAX 04_ VALUE ADDED TAX BATCH 2019

UNIVERSAL COLLEGE OF PARAÑAQUE

COLLEGE OF BUSINESS & ACCOUNTING

TAX04– VALUE ADDED TAX

EXERCISES

MULTIPLE CHOICE

1. Statement 1: For a person to be subjected to any business tax, it is necessary that he is regularly engaged in
the conduct or pursuit of an economic activity.
Statement 2: A non-resident foreign person performing isolated transaction in the Philippines shall be liable to
VAT.
A. B. C. D.
Statement 1 True True False False
Statement 2 True False True False

2. Statement 1: Nonstock and nonprofit private organizations which sell exclusively to their members in the
regular conduct or pursuit of commercial or economic activity are exempt from value-added tax.
Statement 2: Government entities engaged in commercial or economic activity are generally exempt from
value-added tax
A. Both statements are correct.
B. Both statements are incorrect.
C. Only the first statement is correct.
D. Only the second state statement is correct.

3. Which is incorrect?
A. A taxpayer whose, annual gross receipts or sales exceed P 1,919,500 shall pay VAT even if not VAT registered.
B. A taxpayer whose annual receipts or sales do not exceed 1,919,500 but who is VAT registered shall pay VAT.
C. The A non-resident lessor or foreign licensor who is not VAT-registered is subject to vat.
D. An individual taxpayer whose gross sales or receipts do not exceed P 100,000 is exempt from VAT provided
he pays the 3% other percentage tax.

4. In 2018, Mr. Uro's gross receipts from his practice of profession is P 1,600,000 while her wife has gross sales
of P 1,200,000 derived from her trading business. Assuming they are not vat registered, will they be subject
to vat?
A. Yes, because their aggregate gross receipts/sales exceeded the vat threshold of P 1,919,500.
B. No, because for purposes of vat threshold, husband and wife shall be considered as separate taxpayers.
C. Yes, because their gross receipts/sales are not specifically exempt from vat as provided in the Tax Code.
D. None of the above

5. In 2018, the following gross receipts/sales were recorded by Apol B:

Gross receipts from practice of profession P 850,000
Gross receipts from transport of goods and cargoes 1,450,000
Gross sales from trading activities 675,000
Assuming Apol B is non-vat registered, wilt he be subject to vat?
A. No, because his gross receipts/sales in each business do not exceed the vat threshold of P 1,919,500.
B. Yes, because if a professional, aside from the practice of his profession, also derives revenue from other lines
of business which are otherwise subject to VAT, the same shall be combined for purposes of determining
whether the threshold has been exceeded.
C. No, because he is not vat registered
D. None of the above

6. LBJ made the following sales during the 12-month period:

Sales, VAT taxable transactions P 1,500,000
Sales, VAT zero-rated transactions 400,000
Sales, VAT exempt transactions 100,000
Total P 2,000,000
Which of the following statements is correct?
A. LBJ may not register under the VAT system because his sales from VAT taxable transactions did not exceed P
1,919,500.
B. LBJ may not register under the VAT system because his sales from VAT taxable and zero rated transactions
did not exceed P 1,919,500.

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C. LBJ is required to register because his total 12 month sales exceeded P 1,919,500.
D. None of the foregoing

7. Sales during 2018:

Subject to: Delila Antonio Allan Lacson
12% vat P 900k P 950k P 1,200k P 1,000k
0% vat 1,000k 965k 650k 1,000k
exempt 1,200k 785k 550k 250k

Who is/are subject to vat?

A. All of the above
B. None of the above
C. Lacson only
D. Delila only

8. Taxpayers who are qualified to optionally register may apply for vat registration not later than how many days
before the beginning of the calendar quarter?
A. 10 days
B. 20 days
C. 25 days
D. 30 days

9. If a radio and/or television broadcasting company who is not mandatorily required to register under the VAT
system chose to be a VAT taxpayer. Its choice is;
A. Revocable after 2 years
B. Revocable after 3 years
C. Revocable after 5 years
D. Irrevocable

10. D' Lion Transport Corporation has land, sea and air transport operations. To improve its services, which of the
following importation is subject to vat?
I. 20 units of airconditioned buses
II. 12 units of life-saving, safety and rescue equipment for shipping transport operation
III. 12 airplanes
IV. 8 ships
A. I only
B. II only
C. I and II only
D. All of the above

11. An importer of flowers from abroad:

A. Is liable for VAT, if it registers as a VAT person.
B. Is exempt from VAT, because the goods are treated as agricultural products.
C. Is exempt from VAT, provided that his total importation of flowers does not exceed P 1,919,500
D. Is liable for VAT, despite the fact that it did not register as a VAT person and his total annual sales or flowers
do not exceed P 1,1919,500.

12. Which of the following shall be exempt from vat?

A. Services of banks.
B. Services of money changers and pawnshops.
C. Services of credit cooperatives
D. All of the above

13. Which of the following transactions is exempt from value-added-tax?

A. Medical services such as dental and veterinary services rendered by professionals.
B. Legal services.
C. Services arising from employee-employer relationship.
D. Services rendered by domestic air transport companies.

14. Farmers products (FP) is a buyer and miller of agricultural products. During the first quarter, its transactions
are recorded as follows: FP milled its purchase for productions of rice and corn grits with an output of 80%
and sold the products to various retailers for P30 per kilo of palay and P 20 per kilo of corn grits.
Units Costs/kg.
Purchase of palay 500,000kg 15
Purchase of corn 200,000kg 8
Milling of palay of 4,000,000kg 2
Milling corns of customer 3,000,000kg 2
Flow much is the VAT payable of FP during the quarter?
A. P 1,680,000
B. P 1,440,000
C. P 384,000

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D. P 0

15. Which of the following sale or importation of goods shall not be exempt from VAT?
A. Fertilizers
B. Seeds, seedlings and fingerlings
C. Fish, prawn, livestock and poultry feeds, including ingredients, whether locally produced or imported, used in
the manufacture of finished feeds
D. Specialty feeds.

16. Which of the following transactions is exempt from value added tax.
A. Sale by an art gallery of literary works, musical composition, work of art and similar creations, or devices
performed for the production of such works.
B. Medical, dental hospital and veterinary professional services.
C. Sale of cotton and cotton seeds in their original state.
D. Sale of books and any newspaper, magazine, review or bulletin, which appears at regular intervals with, fixed
prices for subscription and sale which is not devoted principally to the publication of paid advertisements.

17. Statement 1: Sale by agricultural cooperatives to non-members can only be exempted from VAT if the producer
of the agricultural products sold is the cooperative itself. If the cooperative is not the producer (e.g. trader),
then only those sales to its members shall be exempted from VAT.
Statement 2: Sale or importation of agricultural food products in their original state is exempt from VAT
irrespective of the seller and buyer thereof.
A. true, true
B. true, false
C. false, false
D. false, true

18. Determine the business taxes of the following:

a. Lease of residential units with a monthly rental per unit not exceeding P 12,800 (regardless aggregate annual
gross rentals).
b. Lease of residential units with a monthly rental per unit exceeding P 12,800 but the aggregate of such
rentals of during the year do not exceed P 1,919,500.
c. Lease of commercial units regardless of monthly rental per unit.
A B C D
I None None None Vat
II Vat OPT OPT Vat
III Vat OPT Vat Vat

19. In cases where a lessor has several residential units for lease, some are leased out for a monthly rental per
unit not exceeding P 12,800 while others are leased out for more than P 12,800 per unit, his tax liability will
be:
A. The gross receipts from rentals not exceeding P 12,800 per month per unit shall be exempt from vat regardless
of the aggregate annual gross receipts.
B. The gross receipts from rentals exceeding P 12,800 per month per unit shall be subject to vat if the annual
gross receipts from said units including the gross receipts from units leased out for not more than P 12,800
exceed P 1,919,500.
C. Both statements are correct.
D. Both statements are incorrect

20. A real estate dealer sold two (2) adjacent residential lots in the city for a price of P 1,000,000 each, or a total
price of P 2,000,000, to a vendee who intends to erect his residential house thereon.
The sale shall be classified as a:
A. 12% VAT transactions
B. 0% VAT transactions
C. VAT exempt transactions
D. None of the foregoing

21. A subdivision developer sold five (5) residential house and lots, each to different vendees, for P 3,000,000 per
lot, or a total sales of P 15,000,000 for the taxable period.
These sales shall be classified as:
A. 12% VAT transaction
B. 0% VAT transactions
C. VAT exempt transactions
D. None of the foregoing

22. Camella realty corporation sold the following real properties during the 2017 taxable year:
2 units of residential house and lot at P 3,000,000 each P 6,000,000
4 residential lots at P 2,000,000 each 8,000,000
1 commercial lot at P 3,000,000 3,000,000

How much is the total amount of transactions subject to VAT?

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A. P 6,000,000
B. P 8,000,000
C. P 11,000,000
D. P 17,000,000

23. Which of the following transactions of a VAT-registered seller is not subject to VAT?
A. Remaining inventory upon retirement from business
B. Sale of company's used car to its officers
C. Sale of goods or services to the national government
D. Sale of residential lot amounting to P 1,000,000

24. The value added tax due on the sale of taxable goods, property and services by any person whether or not he
has taken the necessary steps to be registered.
A. input tax
B. output tax
C. excise tax
D. sales tax

25. Gross selling price includes all of the following except one. Which one?
A. Total amount which the purchaser pays to the seller.
B. Total amount which the purchaser is obligated to pay to the seller.
C. Excise tax.
D. Value-added tax.

26. Which of the following is not deductible from Gross Selling Price for vat purposes?
A. Discounts determined and granted at the time of sale, which are expressly indicated in the Invoice, the amount
thereof forming part of the gross sales duly recorded in the books of accounts.
B. Discount determined and granted after the agreed sales quota is met by the buyer.
C. Sales discount indicated in the invoice at the time of sale, the grant of which is not dependent upon the
happening of a future event, deductible within the same month or quarter given.
D. Sales returns and allowances for which a proper credit or refund was made during the month or quarter to the
buyer for sales previously recorded as taxable sales.

27. On January 5, 2013, Towell Co, VAT-registered, sold on account goods for P 112,000. The term was: 2/10,
n/30. Payment was made on January 10, 2016. The total amount due is:
A. P 110,000
B. P 107,800
C. P 112,000
D. P 109,760

28. Mr. Andres, VAT-registered real estate dealer, transferred a parcel of land held for sale to his son as gift on
account of his graduation. For VAT purposes, the transfer is:
A. Not subject to VAT because it is a gift
B. Subject to VAT because it is a deemed sale transaction
C. Not subject to VAT because it is subject to gift tax
D. Subject to VAT because it is considered an actual sale

29. One of the following is not a transaction deemed sale:

A. Transfer, use or consumption not in the course of business of goods or properties originally intended for sale
or for use in the course of business.
B. Distribution or transfer to shareholders or investors of goods or properties as share in the profits of a VAT-
registered person or creditors in payment of debt,
C. Retirement from or cessation from business with respect to all goods on hand as of the date of such
retirement or cessation.
D. Consignment of goods if actual sale is made within 60 days following the date such goods were consigned.

30. Genson Distribution Inc., a VAT taxpayer, had the following data in a month;
Cash sales P 200,000
Open account sales 500,000
Consignment:
0 to 30 days old (on which there were remittances from
consignees of P 200,000) 600,000
31 to 60 days old 700,000
61 days old and above 900,000
How much is the output tax?
A. P 348,000
B. P 216,000
C. P 264,000
D. P 108,000

31. The following are the data of Davao Appliances Marketing Co. for the last quarter of 2013:

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Sales up to December 15, total
Invoice value P 380,800
Purchases up to December 15, net of input taxes 150,000
Additional information:
On December 16, 2013, the Company retired from its business and the inventory valued at P 190,000 remained
unsold. There is a deferred input tax from the third quarter of P 3,500.
How much is the total value-added taxes payable by Davao Appliances Marketing Co.?
A. P 42,100
B. P 21,500
C. P 22,800
D. P 19,300

32. Evelyn, a trader of appliances, made the following sales of goods during the month of March 2018, exclusive
of VAT:
Cash sales P 200,000
Open account sales 100,000
Installment sales 100,000
Note: Receipt from installment sales is P 20,000
Consignment made: (net of VAT)
January 15, 2018 100,000
February 15, 2018 100,000
March 15, 2018 100,000
Output tax is:
A. P 60,000
B. P 40,800
C. P 72,000
D. P 54,800

33. Sale of raw materials or packing materials to export-oriented enterprise is considered export sales in 2017
when export sales of such enterprise
A. Exceed 50% of total annual production
B. Exceed 50% of total annual production
C. Exceed 70% of total annual production
D. Exceed 80% of total annual production

34. Construction by Mikee-Mega Builders (MMB) of concrete barrier for the Asian Development Bank (ADB) In
Ortigas Center to prevent car bombs from ramming the ADB gates along ADB avenue in Mandaluyong City is
subject to what business tax?
A. 12% vat
B. 0%vat
C. exempt from vat
D. 3% OPT

35. The following are zero-rated, if paid for in acceptable foreign currency and accounted for in accordance with
the rules and regulations of the Bangko Sentral ng Pilipinas prior to TRAIN Law, except one:
A. Sale and actual shipment of goods from the Philippines to a foreign country.
B. Sale of raw materials or packaging materials to a non-resident buyer for delivery to a resident local export-
oriented enterprise.
C. Sale to a non-resident of goods (except automobile and non-essential goods) assembled or manufactured in
the Philippines for delivery to a resident in the Philippines.
D. None of the above.

36. Which is not a requisite of "foreign currency denominated sales" for sales made prior to 2018?
A. The sales exceed an aggregate foreign exchange value of $US 1,000.
B. The buyers are Filipinos abroad, returning overseas Filipino or other nonresidents of the Philippines.
C. The goods are paid for in convertible foreign currency inwardly remitted through the banking system in the
Philippines.
D. The goods are assembled or made in the Philippines for household or personal use.

37. Any input tax attributable to zero-rated sales by a VAT-registered person may at his option be:
A. Deducted from output tax
B. Refunded
C. Applied for a tax credit certificate which may be used in payment of internal revenue taxes.
D. All of the above

38. Tax credit for input taxes shall be allowed if:

A. Both the seller and the purchaser are VAT registered
B. Either one of the seller or the purchaser is VAT-registered.
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.

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39. Which statement is not correct?
A. The excess input taxes of a taxable month arising from domestic sales may be carried over to the succeeding
month.
B. The excess input taxes of a taxable quarter arising from domestic sales may be carried over to the succeeding
quarter.
C. The excess input taxes of a taxable period arising from domestic sales may be refunded.
D. The excess input taxes of a payable period arising from exports sales may be refunded.

40. Magnifeco Corp. is a VAT-registered dealer of appliances, The following data are for the last quarter of 2017:
Sales, total invoice value P 6,920,000
Purchases, net of input taxes 5,500,000
Sales return, total invoice value 200,000
Purchase return, net of VAT 300,000
Deferred input taxes (carried over from the
third quarter of 2017) 12,000
The value added tax payable for the last quarter of 2017 by Magnifeco Corp. is:
A. P 84,000
B. P 96,000
C. P 108,000
D. P 130,500

41. CG Corporation is a vat registered entity with the following data for a taxable month;
Domestic sales P 500,000
Transaction deemed sales 500,000
Export sales 500,000
Sales to DEF, an export oriented enterprises 500,000
(2/3 of DBF's annual output is actually exported)
Purchases (invoice cost from vat 224,000
registered entities)
Purchases (invoice cost from non-vat 100,000
registered entities)
The vat payable of CG should be
A. P 180,000
B. P 156,000
C. P 120,000
D. P 108,000

42. The vat on importation of goods which are subsequently used or sold in the course of trade or business by a
vat registered importer shall be treated as
I. Tax credit
II. Inventoriable cost
III. Expense
A. I only
B. II only
C. III only
D. no of the above

43. Which of the following statements is incorrect?

A. VAT on importation is paid to the Bureau of Customs before the imported goods are released from its custody.
B. When a person who enjoys tax-exemption on his importation subsequently sells in the Philippines such
imported articles to non-exempts person, the purchaser-non-exempt person shall pay the VAT on such
importation.
C. Expenses incurred after the goods are released from Customs custody are disregarded in computing VAT on
importation.
D. Imported goods which are subject to excise tax art no longer subject to value-added tax.

44. Bryan, vat registered person, imported machines from Australia as follows:
Machine Acquisition Cost Purpose
A P 100,000 Personal use
B 200,000 Business use
C 300,000 For sale
The importations were subjected to 50% excise tax based on purchase price. Machine C was sold for P 1,000,000
exclusive of vat. How much is the vat paid to the BOC?
A. P 108,000
B. P 90,000
C. P 54,000
D. P 36,000

45. Using the above data, the amount of vat to be remitted to the BIR should be
A. P 12,000
B. P 30,000

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C. P 106,000
D. P 84,000

46. World Power Corp, imported an article from Japan. The invoice value of the imported articles was $7,000 ($1-
P50). The following were incurred in connection with the importation:
Insurance P 15,000
Freight from Japan 10,000
Postage 5,000
Wharfage 7,000
Arrastre charges 8,000
Brokerage fee 25,000
Facilitation fee 3,000
The imported article was imposed P 50,000 customs duty and P30,000 excise tax.
The Company spent P 5,000 for trucking from the customs warehouse to its warehouse in Quezon City. The carrier
is not subject to VAT.
The VAT on importation is:
A. P 60,000
B. P 42,000
C. P 60,600
D. P 80,000

47. Based on the preceding number, if the imported article was sold for P800,000, VAT exclusive, the VAT
payable is:
A. P 24,000
B. P 12,000
C. P 36,000
D. P 11,040

48. Sofia had the following data for the month of June (all amounts are vat exclusive):
CASE 1 CASE 2
Sales P 1,900,000 P 1,800,000
Purchases of goods for sale 1,260,000 1,600,000
Purchases of Machines 1,440,000 900,000
Machine life 6 years 3 years
The amounts of vat payable (excess tax) shall be:
A B C D
CASE 1 P 54,000 P 73,920 P 73,920 None
CASE 2 (84,000) (84,000) 20,000 None

49. Maymay, VAT-registered, made the following purchases during the month of January, 2018:
Goods for sale, inclusive of VAT P 246,400
Supplies, exclusive of VAT 20, 000
Packaging materials, total invoice amount 55, 000
Home appliances for residence, gross of VAT 17,920
Office machines (5 pcs.), 8 years 2,000,000
useful life, net of VAT
Repair of store amounted to P 20,000, no supporting official receipt. Creditable Input taxes are:
A. P 38,800
B. P 34,800
C. P 37,440
D. P 35,520

50. All of the following are allowed presumptive input tax, except for one.
A. Processor of sardines, mackerel and milk,
B. Manufacturer of refined sugar and cooking oil.
C. Producers/manufacturers of packed noodles.
D. Supplier of books and other school supplies.

51. Mantika Corp, a VAT-registered Corp,, is a producer of cooking oil from coconut and corn. It had the following
data for the month of January 2018:
Sales, gross of VAT P 784,000
Corn & Coconut, 12-31-17 50,000
Purchases of Corn & Coconut 330,000
Corn & Coconut, 1-31-18 20,000
Purchases from VAT suppliers, VAT included:
Packaging Materials 56,000
Supplies 16,800
The value-added tax payable for the month:
a. P 56,060
b. P 54,900
c. P 60,650

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d. P 63,000

52. Taxpayers who became VAT registered persons upon exceeding the minimum turn-over of P3,000,000 in any
12-month period, or who voluntarily register even If their turnover does not exceed P3,000,000 shall be entitled
to a transitional input tax on the inventory on hand as of the effectivity of their vat registration on the following,
except;
a. Supplies for use in the course of taxpayer's trade or business'
b. Goods which have been manufactured by the taxpayer
c. Goods in process for sale
d. Capital goods being used in the operation of the business

53. Transitional input tax can be claimed as deduction from output tax. Which of the following statements is correct?
a. It can be claimed by a vat registrable person.
b. It can be claimed by a taxpayer who registered as vat taxpayer from the inception of business.
c. It can be claimed by a taxpayer who is initially subject to vat and subsequently cancelled his vat registration.
d. It can be claimed by a taxpayer who is initially paying percentage tax and subsequently registered as vat
taxpayer.

54. Which of the following shall be included in the beginning inventory for purposes of determining the transitional
input vat?
a. Goods purchased for resale in the ordinary course of trade or business.
b. Materials purchased for further processing which have not yet undergone processing
c. Goods which have been manufactured by the taxpayer
d. All of the above

55. A taxpayer registered under the VAT system on January 1, 2018, His records during the month show:
Value of inventory as of December 31,
2013 purchased from VAT-registered persons P 112,000
VAT paid on inventory as of December 31, 2013 12,000
Value of inventory as of December 31,
2013 purchased, from non-VAT persons 518,000
Sales, net of VAT 240,000
Sales, gross of VAT 45,920
Purchases, net of VAT 70,000
Purchases of VAT exempt goods 50,000
VAT payable is:
a. P 23,080
b. P 25,320
c. P 12,720
d. P 12,320

56. Carlito, a VAT registered grocery and sugar dealer submitted the following data as of Dec. 31, 2017.to the
Revenue District Officer;
Grocery items, total value P 350,000
Raw sugar cane, total value 150,000
During the month of January 2018, first month as a VAT-registered taxpayer, he had the following sales and
purchases:
Sales Purchases
Grocery, total invoice value P 1,195,040 P 708,400
Raw sugar cane, (Excluding VAT) 570,000 320,000
The VAT payable for the first month is:
A. P 29,400
B. P 47,400
C. P 45,140
D. P 36,500

57. Dong Inc., a manufacturer, had the following data for the first month of 2018:
(First year as a VAT Taxpayer)
Sales:
Export P 2,000,000
Domestics (Without VAT) 1,000,000
Purchases, excluding VAT:
Raw Materials 300,000
Services 100,000
Machinery (estimated useful life 2 years) 400,000

On January 1, 2018, the company had inventories and taxes paid thereon as follows:
Cost VAT Paid
Raw Materials P 120,000 P 2,000
Supplies 40,000 4,000

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During the month, raw materials were purchased from another enterprise with a total invoice value of P 61,600,
not included above.
The VAT payable by Dong Inc. is:
A. P 72,000
B. P 57,000
C. P 11,000
D. P 66,000

58. What institution is required to deduct and withhold a final VAT of 5% on the purchase of goods or services
subject to VAT?
A. National government or any political subdivision thereof
B. Government-owned or con-trolled corporations
C. Both (a) and (b)
D. Neither (a) nor (b)

59. The withholding agent of creditable value added tax is required to remit the amount of value added tax withheld
within
A. 25 days following the end of month the withholding was made
B. 20 days following the end of month the withholding was made
C. 15 days following the end of month the withholding was made
D. 10 days following the end of month the withholding was made

60. 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 in relation to the sale
of goods?
A. The sale Is subject to final withholding VAT.
B. The government-controlled corporation will withhold P 25,000 withholding VAT.
C. The government-controlled corporation shall remit the withholding of VAT to the BIR within 10 days following
the end of the month the withholding was made.
D. The VAT-registered supplier may refuse the withholding of VAT as long as it is willing to pay the full 12% VAT.

Use the following data for the next two questions:

A VAT-registered trader has the following transactions:
Sales of good 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
Purchases of goods sold to GOCC, net of 12% VAT 700,000
61. How much is the output tax?
A. P 300,000
B. P 120,000
C. P 420,000
D. nil

62. How much is the standard input tax?

A. P 20,000
B. P 70,000
C. P 50,000
D. nil

63. How much is the creditable input tax?

A. P 166,000
B. P 96,000
C. P 70,000
D. P 180,000

64. How much is the input tax closed to expense (income)?

A. P 14,000
B. P 34,000
C. (P 14,000)
D. (P 34,000)

65. How much is the VAT payable to the BIR?

A. P 404,000
B. P 390,000
C. P 204,000
D. nil

66. A VAT-registered trader has the following transactions for the month of July 2014:
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 corporations (GOCC), net of VAT 1,500,000

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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
How much is the VAT payable to the BIR?
A. P 280,000
B. P 224,000
C. P 191,500
D. P 300,000

67. Based on the preceding number, how much is the input tax closed to expense (income)?
A. P 13,500
B. P 21,000
C. (P 13,500)
D. (P 21,000)

68. PISC, a vat- registered government owned or controlled corporation (GOCC), sold goods to Alpha Corporation,
a private company, Selling price is P 1,000,000 while the cost (all purchased from vat registered suppliers) is
P 800,000, How much is the VAT-payable by PISC?
A. P 120,000
B. P 50,000
C. P 24,000
D. P 0

69. Based on the preceding number, suppose B is also a GOCC, how much is the VAT payable by PISC to the BIR?
A. P 120,000
B. P 50,000
C. P 24,000
D. 0

Use the following data for the next two questions:

Alpha Corporation (vat registered) has the following data for the month:
Sales - private entities P 2,000,000
Sales - vat exempt goods 1,000,000
Sales - government 1,000,000
The following input taxes were passed-on by vat suppliers to Alpha Corporation during the month;
Input vat on taxable goods P 80,000
Input vat on sale of exempt goods 20,000
Input vat on sale to the government 40,000
Input tax on depreciable capital 150,000
goods not directly attributable to any
specific activity (monthly amortization for 50 months)

70. The vat payable for the month is

A. P 40,000
B. P 80,000
C. P 160,000
D. nil

71. The amount of input vat not available for tax credit but may be recognized as cost or expense is;
A. P 60,000
B. P 70,000
C. P 80,000
D. P 140,000

72. Leomar, a VAT-registered person has the following data:

Export sales, total invoice amount P 3,000,000
Domestic sales, total invoice amount 6,720,000
Purchases used to manufacture Goods
for export and domestic sales:
Raw Materials, VAT inclusive 616,000
Supplies, VAT inclusive 448,000
Equipment, VAT exclusive 300,000
The amount of input tax which can be refunded or converted into tax credit certificates at the option of Leomar is:
A. P 120,000
B. P 118,800
C. P 39,600
D. P 50,000

73. Based on the preceding number, if the refundable input taxes were not refunded but used as tax credit, the
VAT due is;
A. P 576,000
B. P 697,888

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C. P 666,888
D. P 570,000

74. But assuming further that the taxpayer opted to claim them as refund, the VAT due is:
A. P 576,000
B. P 697,888
C. P 746,888
D. P 620,000

75. Data from the books of accounts of a VAT taxpayer for a month:
Domestic Exports
Sales P 2,000,000 8,000,000
Purchases:
From VAT Suppliers;
Goods for sale 600,000 2,400,000
Supplies & services 90,000 360,000
From Suppliers paying percentage tax;
Goods for sale 100,000 *1,500,000
Supplies & services 20,000 80,000
If the input taxes attributable to zero-rated sales are claimed as tax credit, the net value-added tax refundable is:
A. P 136,000
B. P 203,924.70
C. P 145,000
D. P 174,000

76. Rommel is an operator of taxi cabs. During a particular month, he purchased from Mahindra, a VAT-registered
car dealer, 10 sedan type units for a total selling price of 5 million pesos. The estimated useful life of each
vehicle is four (4) years, How much will be the amount due from Rommel?
A. P 5,600,000
B. P 5,150,000
C. P 5,000,000
D. P 4,480,000

77. Based on the preceding number, how much input tax can be claimed by Rommel?
A. P 600,000
B. P.12,500
C. P 150,000
D. P 0

78. Kaktus Realty Inc. developed a condominium in Manila. During the month of January 2013, it had the following
data (VAT included,if applicable):
Selling Price
Cash sale of a 3 bedroom unit P 5,040,000
Sale of parking lot 560,000
Installment sale of 2 bedroom unit
(initial payments exceed 25% of the selling price) 3,920,000

The 3 bedroom unit sold for cash had a zonal value of P5,000,000 and the 2 bedroom unit had a fair market value
per Tax Declaration of P3,000,000,
How much is the output tax for the month?
A. P 920,000
B. P 900,000
C. P 1,020,000
D. P 1,080,000

79. Bahay Kubo Inc. is a real estate dealer. Details of its sales during the year showed the following:
Date of sate June 2, 2014
Consideration in the deed of sale P 5,000,000
Fair market value in the assessment 4,800,000
rolls
Zonal Value 5,200,000
Schedule of payments:
June 2, 2014 1,000,000
June 2, 2015 2,000,000
June 2, 2015 2,000,000
How much is the output tax to be recognized for the June 2, 2015 payment?
A. P 0
B. P 24,000
C. P 249,600
D. P 624,000

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80. Assuming that the scheduled payment on June 2, 2014 is P 2,000,000, how much is the output tax to be
recognized for the June 2, 2016 payment?
A. P 0
B. P 24,000
C. P 249,600
D. P 624,000

Use the following data for the next two (2) questions:
JJ is a real estate dealer. During the month of October 2016, he sold three (3) commercial lots under the following
terms:
Lot 1 Lot 2 Lot 3
Selling Price P 250,000 P 200,000 P 300,000
Cost 150,000 130,000 175,000
Gain/Loss 100,000 70,000 125,000
Terms:
Down, Oct. 5 25,000 50,000 40,000
Due
12/05/ 2016 25,000 20,000 20,000
Year 2017 200,000 130,000 240,000
Zonal Value 350,000 260,000 250,000
81. How much is the Output tax for the month of October?
A. P 26,500
B. P 34,800
C. P 31,800
D. P 40,200

82. The Output tax for December is

A. P 5,400
B. P 4,500
C. P 6,600
D. none

83. Data for a trader with one line of business subject to value added tax and another line of business not subject
to value added tax (amounts presented are gross of vat if applicable);
Sales, vat business P 896,000
Sales, non-vat business 200,000
Purchases of goods, vat business 224,000
Purchases of goods, non-vat business 33,600
Purchase of depreciable asset, for 112,000
use in vat and non-vat business
Purchases of supplies, for vat and 2,240
non vat business
Rental of premises, for vat and non 22,400
vat business, from non-vat lessor
The value added tax payable is
A. P 59,808
B. P 62,208
C. P 82,608
D. P 86,208

84. Tore Inc., a building contractor, showed to you the following data for the month of August 2015;
Cash received, gross of VAT 2,240,000
Receivables, net of VAT 3,000,000
Advances on other contracts still 1,000,000
unearned (w/o VAT)
Unpaid Purchases:
For materials, VAT excluded 500,000
For supplies, VAT excluded 100,000
For services of sub-contractors (VAT included) 1,848,000
Payments for purchases made in July:
Materials, gross of VAT 369,500
Services of subcontractors, net of VAT 495,000
How much is the value added tax payable?
A. P 360,000
B. P 228,600
C. P 330,000
D. P 90,000

85. Cebu Airlines is a corporation organized in the Philippines. It has the following data for the taxable
Year 2013:
Passengers Fare (Net of VAT):

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Flights from Philippines to Hongkong P 8,000,000
Flights from Hongkong to Philippines 8,000,000
Domestic Flights (gross of 2% withholding tax) 3,000,000

Fares from cargoes & mails (Net of VAT):

Flights from Philippines to Hongkong P 1,000,000
Flights from Hong Kong to Philippines 1,500,000
Domestic flights (gross of 2% withholding tax) 800,000
Other Income;
Interest income from bank Deposits 800,000
Rent income 500,000
How much is the Output Tax?
A. P 456,000
B. 516,000
C. P 420,000
D. P 0

86. If a dealer in securities sold shares in the local stock exchange, what business tax will apply to such transaction?
A. VAT based on Gross Selling Price
B. VAT based on gain
C. Capital Gains Tax
D. Stock Transaction Tax of ½ of 1%

87. Fist statement: Unused input tax of persons whose registration had been cancelled may be converted into tax
credit certificate which may be used in payment of other NIRC taxes
Second Statement: Refund or tax credit certificate shall be granted within 25 days from the date of submission
of complete documents.
A. Both statements are correct.
B. Both statements are incorrect.
C. Only the first statement is correct.
D. Only the second statement is correct.

88. Monthly VAT declaration is filed on or before the:

A. 10th day from the end of each month.
B. 20th day from the end of each month.
C. 25th day from the end of each month.
D. 30th day from the end of each month.

89. The Commissioner or his authorized representative is empowered to suspend the business operations and
temporarily close the business establishment of any person for:
A. Failure to issue receipts or invoices of a VAT registered entity,
B. Failure to file a VAT-return for VAT-registered person as required by the tax code.
C. Understatement of taxable sales or receipts by thirty percent (30%) or more of his correct taxable sates or
receipts for the taxable quarter
D. All of the above

90. Lola Lita, a senior citizen, bought a medicine with a selling price of P9,520 inclusive of VAT, How much is the
net amount to be paid by Lola?
A. P 8,500
B. P 7,616
C. P 6,916
D. P 6,800

91. Lolo Sot, a senior citizen went to Jollibee to treat his 4 grandchildren on account of his retirement, They
consumed food and beverages with gross amount of P 1,120 inclusive of VAT. How much is amount to be paid
by lolo Sot?
A. P 896
B. P 920
C. P 1,056
D. P 1,100

92. Lola Trining brought her granddaughter to Jollibee for a treat. Her granddaughter requested that they both
order kiddie meals so that the latter will have two (2) new toys since each meal have a free one. The price of
each meal is P 120 net of VAT. How much is the amount due from Lola Trining?
A. P 268.8
B. P 230.4
C. P 240
D. P 192

93. The ABC Corporation, a vat registered taxpayer sold to Lolo Sot, a senior citizen and to his wife, Ana, a person
with disability, as follows;

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Lolo Sot Ana
Grilled blue martin P 150 P 150
Tokwat baboy 128
Pinaputok na tilapia 134
Seafood soup 100 100
Pineapple juice 64
Buko pandan 70
P 448 P 448
The prices above are based on menu prices inclusive of vat. The output tax due is
A. P38.40
B. P48
C. P96
D. nil

Total amount to be paid by the spouses is

A. P 640
B. P 758.40
C. P 800
D. P 896

94. Statement 1: Persons with disability shall be entitled to claim at least twenty percent (20%) discount from the
purchase of certain goods or services for their exclusive use or enjoyment as provided for under RA7277/RR1-
2009 as amended.
Statement 2: Persons with disability, like senior citizens, shall likewise be entitled to vat exemption,
A. Only statement 1 is correct
B. Only statement 2 is correct
C. Both Statements are correct
D. Both statements are incorrect

95. Gabriana Clinic, a VAT-registered entity, performed a prosthetic surgery on the legs of Loyd, a person with
disability. The total cost of medical operation inclusive of vat was P560,000 , Being a disabled person, Loyd
received 20% discount from Gabriana, How much is the total amount to be paid by Loyd?
A. P 400,000
B. P 448,000
C. P 500,000
D. P 560,000

Use the following data tor the next two questions:

Alpha Corporation (vat registered) has the following data for the month:
Sales- private entities and P 2,000,000
Individuals - (10% to senior citizens)
Sales - vat exempt goods 1,000,000
Sales - government 1,000,000

The following input taxes were passed-on by vat suppliers to Alpha Corporation during the month:
Input vat on goods sold to private P 120,000
entities and individuals
Input vat on sale of exempt goods 20,000
Input vat on sate to the government 100,000
96. The vat payable for the month is
A. P 216,000
B. P 108,000
C. P 96,000
D. P 36,000

97. The amount of input vat not available for tax credit but may be recognized as cost or expense is;
A. P 20,000
B. P 50,000
C. P 62,000
D. nil

End of Handouts

“”Come to me, all you who are weary and burdened, and I will give you rest” – Matthew 11: 28

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