INTERMEDIATE EXAMINATION TAXATION

1. In what doctrine does the proscription to seek immediate judicial recourse as regards
tax disputes finds legal basis?
a. Doctrine of poisonous tree
b. Doctrine of exhaustion of administrative remedies
c. Doctrine of res ipsa loquitor
d. Doctrine of strictissimi juris

2. The Dark Princess & Co. received a final assessment notice last June 15, 2018 for
deficiency income taxes for covered period 2015, 2016, and 2017. After 20 days from
such receipt, the CFO filed a motion to the CIR. As of the present day, the latter is
yet to issue a decision on the protest. Considering the lapse of time since the date
of protest, the CFO now asks for your advice whether he can still file protest before
the CTA.
a. Yes, protest is still allowed since the BIR has not yet acted on the protest.
b. Protest to the CTA is no longer allowed. As a rule, protest must be made only
within the jurisdictional 180-day period to file an appeal to the CTA.
c. Yes. Protest is a matter of right to the taxpayer. He has the option to exercise
the right anytime he deems it proper.
d. Protest is not allowed. More than 180 days have lapsed since filing of protest. The
inaction of the CIR is a “deemed denial” which should have been the proper subject
of appeal.

3. The RATE program of the BIR stands for?

a. Run After Tax Evaders c. Remedy Against Tax Exemptions
b. Run Against Tax Evaders d. Right Against Tax Exemptions

4. These are administrative rulings, more specific and less general interpretations of
tax laws issued from time to time by CIR.
a. BIR Ruling c. Revenue regulation
b. Revenue Orders d. Revenue Memorandum Circulars

5. Princess KT has been assessed deficiency income tax P1,000,000, exclusive of interest
and surcharges, for the taxable year 2018. The tax liability has remained unpaid
despite the lapse of June 30, 2020 (442 days), the deadline for payment stated in the
notice and demand issued by the Commissioner. Payment was made by the taxpayer on
February 10, 2021; 225 days past due date. Compute the total tax due.
a. P1,498,530 c. P1,799,448
b. P1,395,315 d. P1,492,192

6. Princess KT has been assessed deficiency income tax of P1,000,000, exclusive of

interest and surcharge, for taxable year2015. The tax liability has remained unpaid
despite the lapse of June 30, 2017, the deadline for payment stated in the notice and
demand issued by the Commissioner, Payment was made by the taxpayer only on February
10, 2018. Compute the amount due on February 10, 2018.
a. P1,491,644 c. P1,662,141
b. P1,762,963 d. Some other amounts

7. Examine the following statements:

Statement 1: Protest against PAN is allowed through a motion for reconsideration only.
Statement 2: Protest against FAN is allowed either through a motion for
reconsideration or reinvestigation.
Statement 3: Protest against Final Decision on Disputed Assessment (FDDA) is either
through a motion for reconsideration or reinvestigation.

Which is legally incorrect?

a. Statement 1 is correct.
b. Statement 2 is correct.
c. Statement 3 is correct.
d. Not all statements are correct.

8. Examine the following statements:

Statement 1: As regards inaction of a representative, the appeal should be made
directly to the CTA and not to the CIR.
Statement 2: As regards denial of a representative, the appeal should be made to the
CTA or to the CIR.
Statement 3: Only VAT zero-rated transactions are allowed tax credit, refund, and
carry-over options.

Which is correct?
a. Only statements 2 and 3 are correct.
b. Only statements 1 and 2 are correct.
c. Statement 1 is correct; statement 3 is incorrect.
d. All statements are correct.

1 ADMISSION YEAR 2018 - 2019 | 2ND SEMESTER

 INTERMEDIATE EXAMINATION TAXATION

Items 9 – 13. A PEZA-registered entity reported the following items:

Details Registered Activities Unregistered Activities
Gross sales P 121,700,000 P 10,425,000
Cost of sales 103,400,000 7,297,500
Gross income P 18,300,000 P 3,127,500
Other income - 550,500
Total gross income P 18,300,000 P 3,678,000
Operating expense (90%
allocated to registered
activities and the rest P9,890,100
to unregistered
activities)

CWTs from the first 3 quarters amounted to P98,000 (including P10,000 dated 2019)
while CWTs for the 4th quarter totaled P33,600 (excluding P5,000 CWTs not in the
name of the company).

9. Determine the 2% MCIT

a. P439,560 b. P62,550 c. P73,560 d. None of the choices

10. Determine the 30% RCIT

a. P0 b. P1,103,400 c. P806,697 d. None of the choices

11. Income tax still due

a. P0 b. P685,097 c. P675,097 d. None of the choices

12. How much tax has been paid to the provincial government where the PEZA entity is
located?
a. P0 b. P366,000 c. P364,022 d. P915,000

13. How much income tax should be remitted to the BIR?

a. P1,234,097 b. P1,224,097 c. P1,600,097 d. None of the choices

14. Lagrio, a Filipino resident and single, owns a restaurant in Session Road, Baguio City
and in Dagupan, Pangasinan. In 2016, it had the following data:

Gross receipts Expenses

Baguio City P 4,055,015.20 P 3,296,423.10
Dagupan, Pangasinan 3,624,980.60 3,025,114.80

In 2017 the total basic and additional community tax payable by Lagrio is
a. P7,074 c. P1,363
b. P7,699 d. P5,005

15. Helen Corporation, a domestic corporation had the following data for 2016:

Cash sales P 3,954,245

Sales on accounts 1,689,341
Cost of sales 3,453,957
Expenses 1,142,190
Dividend from Zeus Corporation 43,096
Interest income 950

Real properties Zonal value Assessed value

Land P 1,234,590 P 945,687
Building 2,985,043 2,545,890

The total community tax to be paid by Helen Corporation in 2017 is

a. P2,994 c. P4,170
b. P3,494 d. P3,033

Items 16 – 20. Enumerate at least five (5) taxes which are not allowed to be imposed in
local government units. Include the exceptions, if there is any.

--- end of intermediate examination in taxation ---

2 ADMISSION YEAR 2018 - 2019 | 2ND SEMESTER