BUSINESS LAW & TAXATION

EASY ROUND ! 1. Which of the following individuals shall not be subject to the income tax under Section 24 (A) a. "ndividual citi#en of the $hili%%ines residing therein& b. "ndividual citi#en of the $hili%%ines who residing outside the $hili%%ines including overseas contract wor'ers& c. "ndividual alien who is a resident of the $hili%%ines& d. "ndividual alien who is not a resident of the $hili%%ines. Which of the following income is not from a related trade( business or activit) of a domestic %ro%rietar) educational institution a. "ncome from rent of available office s%aces in one of the school buildings b. "ncome from the hos%ital where medical graduates are trained for residenc) c. "ncome from the canteen situated within the school cam%us d. "ncome from boo'store situated within the school cam%us +ow much is the annual communit) tax for individuals a. $ 2, c. $ 1b. $ 2d. $ , .nder at the a. b. c. d. Which a. b. c. d. this s)stem there is a merger of all the %ro%erties of the husband and the wife owned b) them time of the celebration of the marriage( or those ac/uired thereafter. 1onjugal %artnershi% of gains Absolute communit) of %ro%erties 1om%lete se%aration of %ro%erties 2one of the choices is not an essential characteristic of tax 3imited as to amount $ro%ortionate in character $a)able in mone) 4egular %a)ment c. d. 1onsensual contract 4eal contract

2. A

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4. 0

,. A

5. ! 6. A

A contract of sale is not a a. $rinci%al contract b. 2ominate contract

7" %romise to %a) $ or his order the sum of $ 1-(---.-- *- da)s after the death of 8.9 :his is an instrument %a)able; a. At a determinable future time b. <n !emand c. .%on the fulfillment of a condition d. At an indefinite time( hence( non=negotiable A cor%oration ac/uires juridical %ersonalit) a. .%on the filing of the articles of incor%oration b. .%on the filing of the b)=laws c. .%on the issuance of the certificate of incor%oration d. Within *- da)s from recei%t of notice of the issuance of the certificate of incor%oration "t is the right of the mortgagor to redeem the %ro%ert) that was mortgaged after it was sold. a. @/uit) of redem%tion c. 4ight of subrogation b. 4ight of redem%tion d. 4ight of %re=em%tion

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1-. A with violence in her e)es intimidated her husband 0 to sell his exclusive %ro%ert) to her. :he contract of sale is 0 a. 4escissible c. .nenforceable b. Aoidable d. Aoid

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AVERAGE ROUND ! 1. Which of the above will be subject to a 2,C civil %enalt) of the tax or of the deficienc) tax a. Willful neglect to file the return within the %eriod %rescribed b) the :ax 1ode or rules and regulations b. A false or fraudulent return is willfull) made c. A %erson who is not AA:=registered issues an invoice or recei%t showing his :"2( followed b) the word DAA:D d. Eailure to file an) return and %a) the tax due thereon as re/uired under the %rovisions of the :ax 1ode or rules and regulations on the date %rescribed Which of the following statements is "21<44@1: a. :he amount of 7de minimis9 benefits conforming to the ceiling %rescribed in the :ax 1ode shall not be considered in determining the $*-(--- ceiling of 7other benefits9 included in the exem%t 1*th month and other benefits& b. "f the em%lo)er %a)s more than the ceiling %rescribed for 7de minimis9 benefits( the excess shall be taxable to the em%lo)ee receiving the benefits onl) if such excess is be)ond the $*-(--- ceiling. c. An) amount given b) the em%lo)er as benefits to its em%lo)ees( whether classified as de minimis or fringe benefits( shall constitute as deduction u%on such em%lo)er& d. 4e%resentation and trans%ortation allowance which are fixed in amounts and regularl) received b) the em%lo)ees as %art of their monthl) com%ensation shall be treated as taxable fringe benefits if received b) managerial and su%ervisor) em%lo)ees. Fose Fosue /ualified as head of a household for 2--6 tax %ur%oses. Gr. FosueHs 2--> gross income was $2--(--- inclusive of $1-(--- short term ca%ital gain. Gr. Fosue had a long=term loss of $>(--in 2-->. What amount of this ca%ital loss could Gr. Fosue deduct in 2--> a. Iero c. $4(--b. $*(--d. $>(--$enalties andJor interest im%osed on the tax%a)er ma) be abated or cancelled on the ground that the im%osition thereof is unjust and excessive( exce%t when; a. :he tax%a)er is declared insolvent or ban'ru%t. b. :he filing of the return or %a)ment of the tax is made at the wrong venue. c. :he tax%a)erHs mista'e in %a)ment of his tax is due to erroneous written official advice of a revenue officer. d. :he assessment is brought about or a result of the tax%a)erHs non=com%liance with the law due to a difficult inter%retation of the said law. :he actual residential home of the decedent and his famil) at the time of his death( as certified b) the 0aranga) 1a%tain of the localit) where the famil) home is situated( has a fair mar'et value of $*(---(---. :he famil) home is %art of the common %ro%ert) of the s%ouses. +ow much is the famil) home deduction a. $1(,--(--c. $6,-(--b. $1(---(--d. $,--(--A negotiable instrument that is not dated will be considered dated as at the time of a. Acce%tance c. 3ast endorsement b. Eirst endorsement d. "ssuance A delin/uent stoc'holder is not entitled to the following rights( exce%t the right; a. :o be voted b. :o vote or be re%resented in the meetings of stoc'holders c. :o dividends d. +e is not entitled to all the rights of a stoc'holder :hree of the following %artnershi% contracts are void. Which one is not a. A universal %artnershi% of %resent %ro%ert) between husband and wife b. A universal %artnershi% of %rofits between a man and a woman living together as husband and wife without the benefit of marriage c. A %articular %artnershi% between husband and wife d. A universal %artnershi% between a %rivate individual and a %ublic officer :he following are modes of extinguishing an agenc)( exce%t; a. !eath( civil interdiction( insanit) or insolvenc) of the %rinci%al or agent b. Accom%lishment of the %ur%ose of the agenc) c. @x%iration of the %eriod for which the agenc) was constituted d. 1ontinued losses on the %art of the %rinci%al or agent

2. !

*. 1 4. A

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0 5.

6.

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1-. :hree of the following instances will render an offer ineffective before acce%tance is conve)ed. Which one will not ! a. 1ivil interdiction of either %art) c. "nsanit) of either %art)

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b. "nsolvenc) of either %art) d. "ntoxication of either %art)

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DIFFICULT ROUND 1. :he tax%a)erKs 2--* %ercentage tax return is re/uired to be filed through the authori#ed agent ban' under the jurisdiction of 4!< @ast Ga'ati. Without %rior authori#ation from the 1ommissioner( the tax%a)er files the return and %a)s the tax through an authori#ed agent ban' under the jurisdiction of 4!< !avao 1it) on Fune *-( 2--4. :he tax due %er return is $1--(---. +ow much is the total amount due on Fune *-( 2--4 a. $ 1,4(1,,.2, c. $ 2,(---.-b. $ 12?(1,,.2, d. 2one of the choices 2. Which of the following shall not be subject to income tax "= ""= """= $edro 4e)es( an official of 1or%oration 8( as'ed for an 7earl) retirement9 because he was emigrating to Australia. +e was %aid $2(---(--- as a se%aration %a) in recognition of his valuable services to the cor%oration. Fuan 1ru#( another official of the same com%an) was se%arated for occu%)ing a redundant %osition. +e was given $,--(--- as se%aration %a). Fose 0autista was se%arated due to his failing e)esight. +e was given $,--(--- as se%aration %a).

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All the three (*) were not /ualified to retire under the 0"4=a%%roved %ension %lan of the cor%oration. a. "( "" and """ c. " onl) b. " A2! "" d. "" A2! """ <23L :his refers to the control number issued b) authori#ed agent ban' (AA0) to the tax%a)er and 0"4 to ac'nowledge that the tax%a)erKs account has been successfull) debited electronicall) in %a)ment of his tax liabilit). a. Eiling 4eference 2umber b. Ac'nowledgment 2umber c. 1onfirmation 2umber d. :ax%a)erKs "nformation 2umber A tax%a)er %aid excessive tax on A%ril 1,( 2---. <n !ecember 2-( 2--1( she filed a written claim for refund. +er claim was denied b) the 0"4 and she received the denial on Garch 1,( 2--2. She filed a motion for reconsideration with the 0"4 on Garch *1( 2--2. <n A%ril 1-( 2--2( she received the final denial of the 0"4. What will be the tax%a)erHs remed) a. Eile another motion for reconsideration with the 0"4 within *- da)s after the recei%t of the final denial b. Eile an a%%eal with the 1ourt of :ax A%%eals on or before Ga) 1-( 2--2 c. Eile an a%%eal with the 1ourt of :ax A%%eals on or before A%ril 1,( 2--2 d. :he tax%a)er has no more remed) against the final denial A AA: subject real estate dealer sold a residential lot on Fanuar) 1,( 2--6. :he following information was made available on the terms of the sale; Mross selling %rice $ *(---(--"nitial %a)ments on Fanuar) 1,( 2--6 6,-(--0alance to be %aid in e/ual installment( installments starting Eebruar) 1,( 2--6 2(2,-(--:he #onal value of the residual lot was $*(,--(---.

4.

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1 5. A

+ow much was the out%ut tax on Fanuar) 1,( 2--6 using 12C AA: rate a. $ 42-(--c. $ 1-,(--b. $ *5-(--d. 2one of the choices $a)ment made to a third %erson is valid to extinguish the obligation of the debtor to the creditor in the following cases( exce%t; a. After %a)ment to the creditor( the third %erson ac/uires the creditorHs right. b. When the creditor ratifies the %a)ment to the third %erson. c. When through the creditorHs conduct( the debtor was led to believe that the third %erson had authorit) to receive %a)ment. d. When the third %erson is subrogated to the rights of the creditor. 2( 4 and F solidaril) bound themselves to deliver to S a +onda motorc)cle valued at $ 5-(---. :he obligation was not fulfilled through the fault of F. :hereu%on( S filed an action in court against 2 and

6.

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the court awarded $ 62(--- to S re%resenting the value of the motorc)cle %lus damages. Which of the following situation is valid a. "f 2 %a)s S the $ 62(---( 2 can collect 4 and F $ 24(--- each b. S has to collect $ 24(--- each from 2( 4 and F to satisf) the courtHs award of $ 62(--c. 2 can refuse to %a) the %enalt) because it should be charged against F( the guilt) %art) d. "f S succeeds in collecting the $ 62(--- from 2( 2 in turn can collect from 4 $ 2-(--and from F $ *2(-->. $ authori#ed A( a minor( to sell his car for $ 1(---(--- in cash. A sold the said car to 8 on installment at a lesser %rice of $ ?--(---. $ is now re%udiating the contact with 8 on the ground that he is not bound to since 8 contracted with a minor who exceeded his authorit). !ecide. a. $ is liable under the contract because it is enough that the %rinci%al is ca%acitated since he is the one entering into the contract. b. $ is not liable for the sale on installments since it is unenforceable because his agent acted be)ond his %owers. c. $ is not liable because the agent is a minor with whom 8 contracted d. $ is liable %rovided the sale is in cash for $ 1(---(---. A gets a loan of $ 1(---(--- from 0 which becomes due on <ctober 1( 2--> and mortgaged his house as securit) for the debt. <n Fune *-( 2-->( the mortgaged house com%letel) destro)ed the fire through the fault of 1. A wee' later( 0 demanded %a)ment from A. "s 0Hs demand valid a. 2o( the destruction of the house was not thru the fault of A. b. 2o( the obligation is one with a definite %eriod which is deemed intended for the benefit of both the debtor and creditor c. Les( the debt becomes demandable unless A can give another securit) e/uall) satisfactor) d. Les( the debt becomes demandable even if A can give another securit) e/uall) satisfactor)

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1-. <ne of the following characteristics of dacion en pago is also a characteristic of a contract of sale. Which is it ! a. :here is a %re=existing credit b. <bligations are extinguished c. :here is less freedom in fixing the %rice d. <wnershi% of the object transferred to the other %art)

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TIE-BREAKER QUESTIONS 1. An obligation where various %restations are due but the %erformance of all of them is re/uired in order to extinguish the obligation is 'nown as; 1 a. Alternative obligation c. 1onjunctive obligation b. Eacultative obligation d. Sim%le obligation 2. 1 *. "t is an affirmation of fact or an) %romise b) the seller relating to the thing which has a natural tendenc) to induce the bu)er to %urchase the same( rel)ing on such %romise or affirmation. a. 1ondition c. Warrant) b. Ealse re%resentation d. SellerHs tal' Which a. b. c. d. of the following contacts is rescissible 1ontracts entered into during a h)%notic s%ell 1ontracts entered into in a state of drun'enness 1ontracts entered into to defraud creditors when the latter cannot collect the claims due them 1ontracts where both %arties are inca%able of giving consent

4.

Which among the following contracts is void a. A contract of barter between S( insane( and 0( 16 )ears old b. A contract of sale where 0( the bu)er( twisted the arm of S( the seller( so that S would sign the deed of sale c. A contract of sale where 0( the bu)er( aimed a gun at the wife of S( so that S would sign the deed of sale d. A contract for the sale of a cow which is suffering from a contagious disease Who among the following is the holder of a negotiable instrument originall) %a)able to order a. :he original %a)ee who has negotiated the instrument b. :he endorsee who is in %ossession of the instrument c. :he %ossessor of the instrument to whom the instrument was delivered without an) endorsement d. :he endorsee who has negotiated the instrument An instrument %a)able to bearer ma) be negotiated through an) of the following means( exce%t; a. S%ecial endorsement %lus deliver) b. Gere deliver) c. 0lan' endorsement %lus deliver) d. 2o deliver) is re/uired as long as there is an endorsement( whether blan' or s%ecial <ne of the following is not a characteristic of contract of %artnershi%. a. 4eal( in that the %artners must deliver their contributions in order for the %artnershi% contract to be %erfected b. $rinci%al( because it can stand b) itself c. $re%arator)( because it a means b) which other contracts will be entered into d. <nerous( because the %arties contribute mone)( %ro%ert)( industr) to the common fund 4ecording in the 4egistr) of $ro%ert) in the a%%ro%riate boo' is re/uired for the validit) of the contract of; a. 1hattel mortgage c. 1onventional %ledge b. 4eal mortgage d. Antichresis A( 0( 1 and !( joint debtors( are obliged to give A( W( 8( L and I( solidar) creditors( $ 2-(---.-a. A ma) collect from 0 $ 2-(--c. A ma) collect from 0 $ ,(--b. A ma) collect from 0 $ 4(--d. A ma) collect from 0 $ 1(---

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5. !

6. A

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1-. :he following are modes of extinguishing an agenc)( exce%t; a. !eath( civil interdiction( insanit) or insolvenc) of the %rinci%al or agent b. Accom%lishment of the %ur%ose of the agenc) c. @x%iration of the %eriod for which the agenc) was constituted d. 1ontinued losses on the %art of the %rinci%al or agent