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04/21/12

FINAL PRE-BOARD EXAMINATION


April 21, 2012
1. P appointed A as commission agent to sell Ps goods for P10,000 cash. A however
sold the goods on credit for P11,000 without Ps consent. Based on the foregoing
facts, which of the following is correct?
a. P may demand immediate payment of P11.000 cash
b. P may demand immediate payment of P10,000 cash and collect P1,000
later
c. P may ratify the sale on credit for P11,000 and immediately demand
P10,000 from A
d. A is entitled to the excess of P1,000 if P did not ratify the sale on credit
2. A, bought a residential house and lot from B Realty for P2M giving a down
payment of P200,000 and promising to pay the balance of P1.8M in 15 years in
monthly instalments of P10,000. After paying 72 installments A defaulted in the
payment of subsequent instalments. Despite the grace period given, he was not
able to make any further payments. Accordingly, B Realty cancelled the sale.
How much cash surrender value is A entitled to receive?
a. P552,000
b. P396,000
c. P462,000
d. P506,000
3. Which of the following is not a requisite to make an instrument negotiable?
a. If addressed to a drawee, he must be named or otherwise indicated therein
with reasonable certainty.
b. It must contain an unconditional promise or order to pay a sum certain in
money.
c. Where the instrument is payable to bearer, the payee must be named or
otherwise indicated therein with reasonable certainty.
d. Where the instrument is payable to order, the payee must be named or
otherwise indicated therein with reasonable certainty.
4. M, makes a negotiable promissory note payable to the order of P. P made a
special indorsement to A. A made a qualified indorsement to B, a minor.
Subsequent indorsements are from B to C, C to D, and D to E, all by special
indorsement, then E made a qualified indorsement to F. Which of the following
statements is correct?
a. The indorsement made by B transfers title to C, hence B is liable as an
indorser.
b. F can hold E liable if M dishonors the instrument.
c. In case M dishonors the instrument, F can hold all indorsers liable except B.
d. The qualified indorsers A and E and minor B are not liable to F.
5. His warranty extends in favour only of the immediate transferee and to no other
holder
a. Qualified Indorser
b. General Indorser
c. Person negotiating by delivery
d. Person negotiating by blank indorsement
6. Which of the following statements pertaining to treasury shares is correct?
a. Treasury shares are not part of issued capital stock.
b. Treasury shares may not be disposed of at a price lower than the par or
issued price even if it is reasonable and approved by the board of directors.
c. Treasury shares are entitled to vote.
d. Treasury shares, once disposed of, entitle the purchaser or transferee the
right to dividends.
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7. Which of the following is not a negotiable instrument?


a. Pay to B or order P1,000 in 4 equal monthly instalments.
To: X
Sgd. A
b. Pay to B or order P1,000 and debit my account thereafter
To: X
Sgd. A
c. Pay to the order of B within 6 months from date the sum of P1,000 at 12%
per annum
To: X
Sgd. A
d. Pay to B or bearer P1,000 one year after date. If not paid when due, I
agree to pay collection and attorneys fees
To: X
Sgd. A
8. Holder H altered the amount of a negotiable note from P10,000 to P110,000 then
negotiated the note to P. As a result,
a. If P is a holder in due course, he can require the maker to pay P110,000.
b. If P is not a holder in due course, he can require the maker to pay only the
original sum of P10,000.
c. P cannot require the maker to pay because of alteration whether or not he
is a holder in due course.
d. If P is a holder for value, he can collect P110,000 from H.
9. A is a maker and B is payee of a negotiable promissory note payable to order.
There is no valuable consideration for the note B delivers the instrument to C,
without indorsement, under circumstances that otherwise would have made C a
holder in due course such as, that C did not know of the absence of consideration.
May C recover from A?
a. Yes, because As personal defense cannot be used against C.
b. Yes, because the promissory note is negotiable.
c. No, because A has a real defense which can be used even against a holder
in due course.
d. No, because C acquires only Bs rights and A can set up against B the
defense of absence of consideration.
10.The following statements pertain to a voting trustee, except
a. The representative acquires legal title to the shares.
b. It is good only for the meeting for which it was intended.
c. It is generally irrevocable and the representative may vote even in the
presence of the stockholder.
d. The agreement giving the representative the power to vote must be duly
notarized and a copy thereof must be submitted to the SEC to be effective
and enforceable.
11.The articles of incorporation of ABC Corporation provides for 7 directors. In the
monthly meeting of the board of directors held on April 8, 2009, directors B, C, D
and E were present and the following resolutions were approved:
a. A resolution for the purchase of a delivery truck from E Trading, a sole
proprietorship
owned by E. B, C, D and E voted for the resolution.
b. A resolution appointing T as the new corporate secretary where B, C, D
and E voted for the
resolution.
Which is correct?
a.
b.
c.
d.

Both resolutions are valid and do not need stockholders approval.


Both resolutions are valid but need stockholders approval.
Resolution a needs stockholder approval. Resolution b is valid.
Resolution a is not valid. Resolution b needs stockholders approval.

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12.This vacancy in the board of directors may be filled by the board of directors if the
remaining directors still constitute a quorum.
a. Removal of a director
b. Death of a director
c. Increase in the number of directors
d. Expiration of the term of a director
13.M issues a promissory note payable to P or bearer. Which of the following is not
correct?
a. If indorsed by P to A and A also indorses it to B, B may negotiate the note
to C by delivery.
b. If indorsed by P to A and A also indorses it to B, P is liable to A and B.
c. If indorsed by P to A and A also indorses it to B, and B negotiates the note
to C by delivery. A is liable to B and C.
d. If P negotiates the note to A by delivery and A indorses it to B, B may
negotiate the note to C by delivery.
14.Which of the following is not correct?
a. Where the instrument is negotiated back to prior party, all intervening
indorsements are not necessary to the holders title.
b. Where the instrument is originally payable to order, the holder may not
strike out the payees indorsement.
c. The indorser whose indorsement is struck out and all the indorsers are
thereby relieved from liability on the instrument.
d. The holder may at any time strike out an indorsement which is not
necessary to his title.
15.Statement I A majority of the number of directors or trustees as fixed in the
articles of incorporation shall constitute a quorum for the transaction of corporate
business, and every decision of at least a majority of the directors or trustees
present at a meeting at which there is a quorum shall be valid as a corporate act,
except for the election of the officers which shall require the vote of majority of all
the members of the board.
Statement II No person convicted of final judgment of an offense punishable
by imprisonment for a period exceeding five years or a violation of the
corporation code committed within six years prior to the date of his election or
appointment, shall qualify as a director, trustee or officer of any corporation.
a. True, True
b. True, False
c. False, True
d. False, False
16.M makes and delivers a promissory note payable to the order of P. P indorses the
note to A. Later, S steals the note and negotiates the same to B by forging As
signature. Thereafter, B negotiates the note to C, C to D and D to E, a holder in
due course. Which of the following statements is correct?
a. E can hold M and P liable because their signature are genuine.
b. E cannot hold B, C and D liable because they have no participation in the
commission of the forgery.
c. E can enforce the instrument only against S, the forger
d. E can enforce the instrument against S, B, C and D but not against M, P, A.

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17.P, O and A are partners in an import and export business. Customers desiring to
place an order for imported articles are always required to make a deposit of 25%
of the total cost of the order. B, a regular customer, deposited P6,000 to P for his
order. P, instead of turning over the said amount to the partnership,
misappropriated it. As a result, one is not correct
a. B may institute a claim against the partnership and all the partners.
b. The personal liability of the partners is joint.
c. The partnership is bound to make good the loss where one partner acting
within the scope of his apparent authority receives money or property of a
third person and misapplies it.
d. All the partners are liable solidarily with the partnership for everything
chargeable to the partnership.
18.The duty to make disclosure, where otherwise there would be a great and unfair
relation of directors to stockholders.
a. Special Circumstances Rule
b. Trust fund theory
c. Doctrine of corporate opportunity
d. Incorporation Theory
19.M makes a promissory note payable to the order of P for P5,000. After delivery to
P, P changed the amount to P50,000. Thereafter, P indorsed the note to A, A to B,
B to C, C to D and D to E. The parties subsequent to P were not aware of the
alternation made by P. Which of the following statement is correct?
a. E can hold M liable for P50,000 if E is a holder in due course
b. E can hold M liable for P5,000 if E is a holder is due course
c. E can hold M liable for any amount if E is not a holder in due course
d. E can hold A, B, C and D liable for P50,000 provided E is a holder in due
course
20.A contract where the creditor acquires the right to receive the fruits of an
immovable of his debtor, with the obligation to apply them to the payment of
interest if owing, and thereafter to the principal of his credit is
a. Antichresis
b. Usufruct
c. Real estate mortgage
d. Commodatum
21.A holder is a holder in due course if he has taken the instrument complete and
regular on its face and three of the following conditions, except
a. That he became the holder of the instrument before it was dishonored and
without that it had been previously dishonored if such was the fact
b. That he took it in food faith and for value
c. That there is negotiation to him before it became overdue
d. That at the time it was negotiated to him, he had no notice of any infirmity
in the instrument or defect in the title of the person negotiating the same
22.M executes a promissory note for P10,000,000 payable to the order of P. M and P
had a private understanding that M is liable only for the discounted amount of
P9,500,000. P indorsed the note to A, A to B, B to C, C and D and D to H, holder.
As a result,
a. M may refuse to pay H if P is a minor
b. If M dishonors the note, A may refuse to pay H on the ground that A is a
remote party
c. The indorsement made by P passed title to the instrument in favor of A
even if P is a minor
d. M is liable to H for P9,500,000 since that was the amount that he agreed
with P that he should pay

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23.A pledged his ring to B for P20,000. A failed to pay his obligation. B sold it at a
public auction for P18,000. Can B recover the deficiency?
a. Yes, even without stipulation
b. Yes, if there is stipulation
c. No, even if there is stipulation
d. No, unless there is stipulation
24.Using
a.
b.
c.
d.

the above data, if the sale is P22,000. Can A recover the excess?
Yes, even without stipulation
Yes, if there is stipulation
No, even if there is no stipulation
No, if there is stipulation

25.C mortgaged his car to B for P200,000. C failed to pay his obligation. B sold it at a
public auction for P180,000. Can B recover the deficiency?
a. Yes, even without stipulation
b. Yes, only if there is stipulation
c. No, even if there is stipulation
d. No, unless there is stipulation
26.Using
a.
b.
c.
d.

the above data, if the sale is for P220,000, can C recover the excess?
Yes, even without stipulation
Yes, only if there is stipulation
No, even if there is stipulation
No, unless there is stipulation

27.Any director of a corporation maybe removed from office by a vote of


a. Majority of the members of the board
b. Majority of the stockholders present
c. 2/3 of the stockholders present
d. 2/3 of the outstanding capital stock
28.A, B and C are partners in a universal partnerships of profits engaged in operation
of taxis. The partners contributed:
A- 100 Toyota Vios
B- 3,000 sqm land
C- Fuel and oils
Which of the following is correct?
a. In case of loss due to fortuitous event, the partnership bears the loss
b. The partnership becomes the owner of the things contributed to the
partnership
c. The partners retained the ownership over the things they contributed
hence, they will bear the risk of loss
d. The partnership begins from the moment of the execution of the contract,
except if stipulated otherwise
29.As regards cash dividends, which of the following is correct?
a. Declared by the board by majority vote and ratified by the stockholders by
majority vote
b. Declared by the board by majority vote and ratified by the stockholders by
2/3 vote of the outstanding capital stock
c. Declared by the board by majority vote and need not be ratified by the
stockholders
d. Declared by the board by 2/3 vote and need not be ratified by the
stockholders

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30.Which of the following statements is not correct?
a. An agreement to constitute a commodatum is binding and is perfected
from the moment there is meeting of minds
b. Fixed, savings, and current deposits of money in banks and similar
institutions shall be governed by the provisions concerning mutuum
c. Precarium is a kind of commodatum where the bailor may demand the
thing loaned at will
d. In case of extraordinary expenses, the debtor in mutuum will shoulder 50%
if he is in actual use of the thing borrowed
31.A contributed P1M, B contributed P1M, and C contributed services. They agreed to
divide the profits and losses equally. In case of loss of P3M, for how much, if any,
is C liable?
a. Nothing, because an industrial partner is exempt from losses
b. P1M but with reimbursement from A and B equally
c. A and B shall shoulder the loss equally at P1.5M each
d. P1M, as stipulated
32.As regards the corporate by-laws, which of the following is true?
a. To adopt, amend or repeal- 2/3 of the outstanding capital stock is needed
b. To delegate to the board of directors the power to amend, repeal or adopt
new by-laws, majority of the outstanding capital stock
c. To revoke the power delegated to the board to amend, repeal or adopt new
by-laws, 2/3 of the outstanding capital stock
d. To amend, repeal or adopt new by-laws, majority of the outstanding capital
stock
33.A contract of antichresis is
a. A contract of mortgage whereby possession of the mortgaged property is
given to the creditor
b. A contract of loan secured by a real property; where possession is retained
by the debtor
c. A contract of loan without security
d. A consensual contract as it is perfected by mere consent
34.A subscribed to 1,000 voting shares of stock of X Corporation. She paid 25% of
the said subscription. During the stockholders meeting, can A vote all her
subscribed shares?
a. No, because the subscription has not yet been fully paid
b. No, because As shares have become delinquent which cannot be voted
c. Yes, as to the paid percentage of subscription
d. Yes, because unpaid shares not delinquent can be voted
35.A was having his house repaired by B, who needed construction materials, so A
orally told the seller C, Give B the materials, I shall be responsible. I shall pay in
30 days. C delivered the materials. As a result,
a. The contract is unenforceable because A made an oral agreement to
answer for the debt of B
b. The contract is unenforceable because A did not make a special promise to
answer for the default of another person
c. The contract shall be enforceable if there is ratification by A
d. The contract shall be unenforceable if the value is at least P500.00
36. In which of the following is demand necessary to make the debtor in delay in the
performance of his obligation?
a. When the time of performance is of the essence
b. When the time of performance has been stipulated
c. When the law so provides
d. When demand would be useless

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37.P appointed A1 and A2 as his agents for a common transaction and they agreed
that they shall be solidarily liable to P for damages in case of violations of their
obligation as such. When is the agent at fault the only one liable for damages
even if solidarity has been stipulated?
a. If the other agent is not at fault
b. Both of them shall be liable always since solidarity was agreed upon
c. If the one at fault shall answer for all the damages
d. If the one at fault acted in excess of authority
38.A and B are co-owners of a parcel of land from where they share the profits
equally as co-heirs in inheritance. Is there a partnership?
a. There is a prima facie presumption of partnership because of the equal
sharing of profits
b. There is no partnership because co-ownership by itself does not establish a
partnership despite the sharing of profits
c. There is no partnership since in partnership, division of profits is not always
necessary among partners
d. There is prima facie presumption of partnership they being co-owners and
co-possessors
39.A and B are partners in AB partnership. While A was performing his duties as a
partner in the course of business, he negligently caused damages to X, a third
person. Who shall be liable to X and up to what extent?
a. Only the partnership shall be liable it being a juridical person separate and
distinct from the partners
b. Only A shall be liable for he is the only one at fault
c. Both A and B shall be liable solidarily to X
d. A, B, and the Partnership are all liable solidarily to X
40.In the
a.
b.
c.
d.

matter of management of the corporation, this is supreme:


President
Chairman of the Board of Directors
Stockholders
Board of Directors

41.Which of the following statements is not correct?


a. Compensation income of individuals that do not exceed the statutory
minimum wage is exempt from the requirement of withholding tax on
compensation
b. Compensation income of individuals that do not exceed ten thousand pesos
per month is exempt from the requirement of withholding tax on
compensation
c. Holiday pay, overtime pay, night shift differential pay and hazard pay
received by individuals shall be exempt from income tax
d. Minimum wage earners who are receiving only the statutory minimum
wage are not subject to withholding tax and consequently to income tax
42. ABC, a bed proprietary hospital organized in 2000, had the following data for
2011:
Gross receipts from patients and laboratory services
P8.5M
Rental Income (net of 5% w/t)
1.425M
Total hospital expenses
8.2M
The income tax still due for 2011 is:
a. Php 540,000
b. Php 105,000
c. Php 180,000
d. Php 465,000

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43.A filed his income tax return for calendar year 2007 on March 20, 2008. When is
the last day for the BIR to collect, assuming A did not pay the tax due upon filing?
a. March 20, 2011
b. April 15, 2011
c. April 15, 2013
d. March 20, 2013
44.Using the data above data, assuming A filed his income tax return on April 20,
2008 and the return is not fraudulent, when is the last day for the BIR to make an
assessment?
a. April 20, 2011
c. April 20, 2013
b. April 15, 2011
d. April 15, 2013
45.Using the data above data, if the BIR issued a deficiency income tax assessment
on March 10, 2010, when is the last day for the BIR to collect?
a. March 10, 2013
b. April 15, 2013
c. March 10, 2015
d. April 15, 2015
46.The export sales of a vat registered enterprise is
a. Exempt from the vat
b. Subject to 0% vat
c. Subject to 12% vat
d. Subject to percentage tax
47.A filed his ITR for 2011 on April 15, 2012 and will pay his tax liability in
instalment. The return shows an income tax due of P100,000 and income tax
withheld of P60,000. If A pays the 2 nd installment only on October 15,2012, the
amount to be paid (excluding compromise penalty) is
a. P26,000
b. P35,000
c. P55,000
d. P52,000
48.The DOC restaurant, a VAT-registered taxpayer, issued the following official
receipt dated April 18, 2012:
2 pieces crispy chicken
P200.00
Siomai special
45.00
Sago-gulaman
85.00
Mushroom and chicken soup 100.00
Braised beef with cauliflower
240.00
Coke light in can (2xP40)
80.00
P750.00
Local tax
15.00
Service charge
60.00
Total
P825.00
The output vat on the sale is
a. P99.00
b. P88.39
c. P80.36
d. P81.96

49. Which of the following properties owned by a non-resident alien decedent is not
subject to the rule on reciprocity?
a. Shares of stock in a Philippine domestic corporation
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b. Investment in stock in a US corporation 80% of the business of which is in
the Philippines
c. Investment in bonds in a US corporation that have acquired business situs
in the Philippines
d. 40% share in a Philippine partnership
50.Due to financial difficulties, ABC Corp requested that its 2011 income tax liability
of P400,000 be paid in four (4) equal monthly instalments, starting April 15, 2012.
Its request for instalment payment was approved on April 8, 2010. The tax due on
May 15, 2012 is
a. P100,000
b. P101,667
c. P105,000
d. P106,667
51.Mr. Bagongbahay acquired his old principal residence in 1990 at a cost of P4M. He
sold the said property on January 1, 2010 for P16M, although the FMV on that due
was P20M. Within the reglementary period, Bagongbahay acquired his new
principal residence for P12M. Which of the following is incorrect?
a. Bagongbahay has to pay capital gains tax of P300,000
b. The cost basis for the new principal residence is P3.2M
c. The utilized amount of the gross selling price is P12M.
d. If the proceeds were not used to buy a new principal residence, the capital
gains tax should have been P1.2M
52.On April 15, 2010, A filed his income tax return for his 2009 income and paid the
tax due thereon. In 2011, A discovered that he made an overpayment in his
income tax return. He filed a written claim for refund of tax erroneously with the
CIR on October 1, 2011. On April 14, 2012, without receiving a decision on his
claim for refund, A filed in the CTA a petition for review on his claim for refund of
tax erroneously collected. Which of the following is correct?
a. The CTA did not acquire jurisdiction over the petition for review because
the appeal is premature, there being no decision yet on said claim for
refund
b. The CTAs jurisdiction is to review by appeal decisions of the BIR
Commissioner so if there is no decision, there is nothing to review
c. The CTA acquired jurisdiction over the petition since it is the right of a
taxpayer to go to the CTA with or without decision rendered by the BIR
Commissioner
d. The CTA acquired jurisdiction over the petition as the peremptory period of
2 years within which a claim for refund is about to expire and the failure of
the CIR to act on the claim is tantamount to denial of the claim
53.A sold a personal property held as capital asset he acquired 9 years ago with an
acquisition cost of P150,000 for P270,000. The payment shall be made in the
following terms. Cash down payment of P40,000 and additional P10,000 at the
end of the year of sale. The property sold has been mortgaged for P160,000
which is assumed by the buyer. The buyer issued a note payable for the balance
which is to be paid equally in two years following the year of sale. The contact
price is
a. P270,000
b. P110,000
c. P120,000
d. P130,000
54.The taxable profit for the first year is
a. P120,000
b. P60,000
c. P30,000
d. P15,000
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55.XYZ corporation filed its income tax return and paid the tax due for calendar year
2011 showing a tax liability of P175,000. However, upon audit, it was discovered
that its income tax return was false or fraudulent because it did not report other
taxable income. Per investigation the correct income tax due is P350,000. The
corporation was duly informed of this finding through preliminary assessment
notice. Failing to protest on time against the preliminary assessment notice, a
formal letter of demand and assessment notice was issued on May 31, 2013
calling for payment of the deficiency income tax on or before July 15, 2013. The
amount due on July 15, 2013 is
a. P306,250
b. P218,750
c. P341,250
d. P612,500
56.DEF College, a private educational institution organized in 2009 had the following
data in 2011:
Tuition Fees
Php 4.8M
Rental Income (net of 5% w/t)
4.940M
Total school expenses
9.45M
The income tax still due for 2011 is
a. Php 165,000
b. (Php 95,00)
c. (Php 60,00)
d. Php 200,000
57.The point on which a tax burden finally rests or settles down is
a. Nature of taxation
b. Theory of taxation
c. Impact of taxation
d. Incidence of taxation
58.One of the following distinctions between donation inter vivos and donation
mortis causa is not correct?
a. The first takes effect during lifetime of the donor while the second takes
effect upon the death of the grantor
b. The first requires a public document while the second does not require a
public document
c. The first is subject to donors tax while the second is estate tax
d. The first is valued at fair market value at the time the property is given
while the second is valued at fair market value at the time of death of the
grantor
59.ABC Corporation, a vat-registered enterprise has the following sales for the
month:
Sale to private entities
Php 2,000,000
Sale of exempt goods
1,000,000
Sale to the government
1,000,000
Total sales for the month
Php 4,000,000
The following input taxes were passed on by its vat suppliers:
Input tax on taxable goods
Php 80,000
Input tax on sale of exempt goods
20,000
Input tax on sale to the government
40,000
Input tax on depreciable capital goods not directly attributable
to any specific activity (monthly amortization for 60 months)
160,000
The vat due for the month is
a P80,000
b P160,000
c P40,000
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d

60.Using the preceding number, the amount not available for input tax credit but
may be recognized as cost or expense is
a. Php 140,000
b. Php 70,000
c. Php 60,000
d. Php 80,000
61. Which of the following statements is not correct?
a. An article subject to excise tax maybe exempt from vat
b. An article subject to excise tax maybe subject to vat
c. A taxpayer may have two businesses where one is subject to vat and the
other is subject to percentage tax
d. Manufacturers and importers of goods are subject to excise tax
62. A, a citizen of the Philippines and a resident of Bacolod City, died testate on April
19, 2012. Among his gross estate are properties purchased from his father who
died on April 4, 2009. What percentage of deduction will be used in computing
the amount of vanishing deduction?
a. 20%
b. 40%
c. 60%
d. 0
63. The donor and done are stranger to each other
a. Gift to the brother of donors grandfather
b. Gift to the daughter of the granddaughter of the daughter of the donors
granddaughter
c. Gift to the grandson of the donors sister
d. Gift to the granddaughter of the sister of the donors mother
64. One of the following is not exempt from VAT
a. Lease of residential units with a monthly rental not exceeding P12,800
b. Services subject to percentage tax
c. Services rendered by individuals pursuant to employer-employee
relationship
d. Export sales by persons who are vat-registered
65.Which one of the following is not allowed with presumptive input tax
a Those engaged in the manufacturing of refined sugar
b Those engaged in manufacturing packed noodle based instant meals
c Those engaged in the processing of canned products
d Those engaged in pasteurizing milk
66. If the surviving heirs are the spouse and parents of the decedent, the legitime of
the spouse under testamentary succession is
a. 1/4
b. 1/3
c. 1/8
d. 1/2
67. Property subject to vanishing deduction had the following data. Fair market value
when inherited 4 years before and at the death of P220,000 and P320,000
respectively. Mortgage indebtedness paid thereon by the decedent is P20,000.
Gross estate and deductions (except vanishing deduction and family home and
standard deduction) of P2,000,000 and P50,000, respectively. The vanishing
deduction is
a. P78,000
b. P220,000
c. P195,000
d. P39,000
11

04/21/12

68. A, a VAT registered person had the following data for April 2012 (vat not
included):
a. Export sale of feeds for animals
i For human consumption
P 1,500,000
ii For race horses and fighting cocks
500,000
b Domestic sale of feeds for animals
i For human consumption
P
750,000
ii For race horses and fighting cocks
250,000
c Input tax which cannot be directly attributed
to any of the above sales
100,000
The output tax for April is
a. P30,000
b. P90,000
c. P60,000
d. P120,000
69. Using the above data, the vat still due (excess input tax) is
a. (P45,000)
b. (P20,000)
c. (P70,000)
d. P5,000
70.Which of the following is subject to vat?
a Sale of passenger or cargo vessels and aircraft for domestic or international
transport operations
b Sale of agricultural and marine food products in their original state
c Sales by agricultural cooperatives duly registered with the Cooperative
Development Authority
d Sale of fuel, goods and supplies by persons engaged in international
shipping or air transport operations
71. Proceeds of life insurance where a third person other than the executor, or
administrator or the decedent is the beneficiary is
a. Part of gross income whether revocable or irrevocable
b. Not part of gross income whether revocable or irrevocable
c. Part of gross estate whether revocable or irrevocable
d. Not part of gross estate whether revocable or irrevocable
72. As income tax liability for 2011 was P75,000. She filed the return and paid the
total amount due but not with the proper internal revenue district office on July
15, 2012. The amount payable (ignoring compromise penalty)
a P97,500
b P112,500
c P116,250
d P135,000

73.The following were taken from the income statement of A Corporation for the
taxable year 2011:
12

04/21/12
Gross profit from sales

P1,000,00
0

Less: Business connected expenses


Provision for bad debts

P630,000
90,000

Net income before income tax


Additional information:
a. Accounts written off during the year and charge to allowance
for bad debts
b. Recoveries on account receivable previously written off in
2010
i
Allowed by BIR as deductions
ii
Disallowed by BIR as
deduction
c. Refund of taxes paid in 2010:
i
Allowed by BIR as deduction
ii
Disallowed by BIR as deduction

720,00
0
P
280,000
P
60,000

30,000
40,000

50,000
60,000

The taxable income is


a P310,000
b P410,000
c P390,000
d P340,000
74. DODC Airlines, an international air carrier showed the following gross receipts:
Point of Origin
Philippines
Philippines
Singapore

Destination
China
Singapore
Japan

Gross Receipts
P 2,000,000
1,600,000
3,000,000

Twenty-five percent of the shipment from the Philippines to Singapore were later
shipped from Singapore to Japan. The percentage tax due is
d
e
f
g

P198,000
P186,000
P108,000
P96,000

75.DODC Broadcasting, a non-vat holder of a franchise to operate a radio and


television network reported the following gross receipts (net of any tax):
Year 2010
P 9,000,000
2011
12,000,000
2012
18,000,000
The business tax liability
2010
a
b
c
d

P 270,000
1,080,000
270,000
1,080,000

2011
P 360,000
1,440,000
1,440,000
360,000

2012

P2,160,000
2,160,000
2,160,000
2,160,000

13

04/21/12

76.The gross estate of A includes P80,000 receivable which is duly notarized from
the debtor B whose records show:
a Assets
P 100,000
b Indebtedness to:
i
Government by way of taxes
40,000
ii
A
80,000
iii
Other creditors
20,000
The deductible claims against insolvent person is
a

P80,000

b. P29,285

c. P48,000

d. P32,000

77.XYZ Corporation, a domestic corporation had the following data during the
calendar year 2011
Gross income
Business connected expenses
Dividends from:
a Domestic corporation
b Foreign corporation, 90% of the gross income was
derived from the Philippines
c Foreign corporation, 60% of the gross income was
derived from the Philippines
d Foreign corporation, 30% of the gross income was
derived from the Philippines

P
1,000,000
400,000
100,000
100,000
80,000
40,000

The taxable income is


a P920,000
b P820,000
c P748,000
d P750,000
78.C, vat-registered person, imported machines to be used in the Philippines as
follows:
Machines
Purchase Price
Purpose
1
P100,000
Personal Use
2
200,000
Business Use
3
300,000
For Sale
The importations were subjected to 50% excise tax based on purchase price.
Machine 3 was sold for P1,000,000 (net of vat). How much is the vat paid on
importation?
a. P108,000
b. P90,000
c. P54,000
d. P36,000
79.Using
a.
b.
c.
d.

the above date, the vat payable is


P12,000
P30,000
P106,000
P84,000

14

04/21/12

80.A, a VAT registered taxpayer made the following acquisition of capital goods from
VAT registered suppliers (net of vat) during the quarter;
Date
Cost
Estimated Life
July
2
P1,500,000
8 years
10
500,000
2 years
Aug.
5
400,000
3 years
20
500,000
4 years
Sept.
10
500,000
4 years
15
600,000
6 years
The July 2 acquisition was retired in September. The input tax for September is
a. P176,450
b. P178,950
c. P7,950
d. P4,950

15

04/21/12
ANSWERS: (April 21, 2012)
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20

D
D
C
B
C
D
A
D
D
B
C
B
C
C
B
D
B
A
B
A

21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40

A
C
C
B
A
A
D
D
C
D
D
D
A
D
B
B
D
B
D
D

41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60

16

C
B
B
A
C
B
C
C
B
C
B
D
C
C
A
B
D
B
A
B

61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80

D
D
D
D
C
A
D
A
A
D
B
C
C
D
A
D
B
A
B
B

81