Chapter 8 - Value Added Tax MCQ

d. Goods exempt from customs duties classified as personal and household effects belonging to residents of the Philippines returning from abroad.

50. One of the following is not subject to vat on importation a. Goods brought into the Philippines in the course of trade or business by vat registered person. b. Goods brought into the Philippines not in the course of trade or business by a person who is not vat registered. c. Tax free goods imported by tax-exempt importer who transferred them to a person who does not enjoy exemption from importation tax. d. Goods exempt from customs duties classified as personal and household effects belonging to residents of the Philippines returning from abroad.

b. Should be paid by the non-tax exempt purchaser to whom the tax exempt importer sells it.

50. Which statement is correct? Vat on importation a. Should be paid by the tax exempt importer, if he subsequently sells the goods to a non-tax exempt purchaser. b. Should be paid by the non-tax exempt purchaser to whom the tax exempt importer sells it. c. Is a liability shall either of the tax exempt importer or the non-tax exempt purchaser. d. Shall not pay the value added tax because the transaction was exempt at the point of importation.

b. P57,600

83. A VAT-registered person has the following data: Export sales, total invoice amount P400,000 Domestic sales, total invoice amount 672,000 Purchase of raw materials, used to manufacture goods for export and domestic sales, VAT inclusive 560,000 Supplies used for both export and domestic sales, VAT inclusive 448,000 Purchase of equipment used in the manufacture of goods for export and domestic sales, VAT exclusive 300,000 The amount of input tax which can be refunded or converted into tax credit certificates at the option of the VAT-registered person is: a. P50,400 b. P57,600 c. P144,000 d. P86,400

b. P62,208

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: Sales, vat business, vat included P896,OOO Sales, non vat business 200,000 Purchases of goods, vat business, vat included 224,000 Purchases of goods, nonvat business, vat included 33,600 Purchase of depreciable asset, for use in vat and non vat business, vat included 112,000 Purchases of supplies, for vat and non vat business, vat included 2,240 Rental of premises, for vat and non vat business, from non vat registered person 22,400 The value added tax payable shall be: a. P59,808 b. P62,208 c. P82,608 d. P86,208

d. Dissolution of a partnership and the creation of a new partnership.

Deemed sale" for VAT purposes includes inventories of taxable goods existing at the time of: a. Change of control of a corporation thru the acquisition of the controlling interest. b. Change in the trade name or corporate name of the business. c. Merger or consolidation. d. Dissolution of a partnership and the creation of a new partnership.

a. P0

Empleo Construction Company entered into a contract with the government to. construct an edifice for a total contract price of 25,000,000. During the month, the government paid P10,000,000 of which it withheld 5% final withholding tax. How much is the VAT payable by the company on the government contract? a. P0 b. P150,000 c. P850,000 d. P1,000,000

a. Total price agreed upon for one or more assets acquired during the calendar month.

For purposes of claiming input vat on depreciable assets, the aggregate acquisition cost of a depreciable asset in any calendar month refers to the: a. Total price agreed upon for one or more assets acquired during the calendar month. b. Payments actually made during the calendar month. c. Total price agreed upon for one asset only acquired during the calendar month. d. Initial payments made if purchased on installment plan.

b. P480,000

GJ is a contractor. He entered into a contract on September 1, 2018 which was completed on September 30, 2018. On the same date, he received the total value of the contract amounting to P5,500,000. GJ spent for the materials used in the contract which he acquired from value added registered suppliers costing P1,500,000. All amounts are exclusive of VAT. The VAT payable by GJ for the month of September is: a. P150,000 b. P480,000 c. P400,000 d. P595,000

d. Value-added tax

Gross selling price includes all of the following, except 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

c. (P2,400)

Hananiah Corporation has the following sales and purchases for the quarter ending December 31, 2018: October: Sales P50,000 Purchases 40,000 Nov. & Dec.: Sales 100,000 Purchases 80,000 Carry over input tax from previous quarter 6,000 How much is VAT payable (carry over) for the quarter ending December 31, 2018? a. P5,000 b. P3,500 c. (P2,400) d. (P5,000)

c. Both I and II

In order that an invoice will qualify as a VAT invoice or receipt for purposes of claiming tax credit for input tax, it must contain: I. The vat registration number. II. The total amount which the purchaser pays or is obligated to pay the seller with the indication that such amount includes the vat. a. Only II b. Neither I nor II c. Both I and II d. only I

b. On collections of the month on all billings made

In the VAT on sale of services, the output tax is computed: a. On billings of the month b. On collections of the month on all billings made c. On the contract price of contracts completed during the taxable period d. Only and strictly on labor performed under the contract for services

b. Prepaid rental

In the lease contract, which of the advance payment by the lessee is subject to output VAT? a. A loan to the lessor from the lessee b. Prepaid rental c. An option money for the property d. A security deposit to insure the faithful performance of certain obligations of the lessee to the lessor

c. Aggregate monthly purchases of capital assets, excluding VAT, exceeds P1,000,000

Input vat on purchases of capital assets shall be spread (amortized over 60 months or useful lives of the capital assets if shorter than 60 months) when: a. Capital assets have been acquired from enterprises registered with and located at the export processing zones b. Value of asset, excluding VAT, exceeds P1,000,000 c. Aggregate monthly purchases of capital assets, excluding VAT, exceeds P1,000,000 d. VAT taxpayer has secured prior approval for him to amortized input tax on purchases of capital assets.

a. Dealer in securities

A merchant of stock or securities, whether individual, partnership, or corporation, with an established place of business, regularly engaged in the purchase of securities and the resale thereof to customers, and who, as a merchant, buys securities and resells them to customers with a view to the gains and profits that may be derived there from. a. Dealer in securities b. Stock brokers c. Underwriters d. Stock merchants

c. Carry-over and apply his excess tax credit against output taxes in the subsequent period or periods.

A taxpayer has excess credit as a result of input taxes paid on purchases of capital goods. He may: a. Have his excess tax credit refunded to a VAT registered person. b. Make his application for refund in the subsequent period following the period during which the purchases were made. c. Carry-over and apply his excess tax credit against output taxes in the subsequent period or periods. d. Use it in payment of any internal revenue tax of a VAT registered person.

c. P108,000

Alex is in the course of trade selling real property. During the month of February, it had the following data (per sales document, inclusive of vat) Cash sales P560,000 Sales on deferred payment basis (initial payments exceeds 25% of selling price) 336,000 The real property sold for cash had a zonal value of P600,000 exclusive of vat and the property sold under deferred payment basis had a fair market value of P200,000, exclusive of vat. How much is the output vat on the sale of real property? a. P84,000 b. P96,000 c. P108,000 d. P112,320

d. None of the above

All of the following except one, are subject to VAT? a. Importation of radio and television equipment by broadcasting and television stations b. Lease of cold storage rooms in ice plants and cold storage c. Sale of paintings d. None of the above

c. P684,000

JJ Contractors entered into a contract on October 2017 to build a warehouse for Francis Corporation. The total contract price amounting to P10,000,000 was received by JJ upon completion on June 30, 2018. Materials purchased during construction valued at P4,000,000 were paid on June 1, 2018 while a construction equipment worth P3,000,000 (net of VAT) was purchased on January 1, 2018 with the following terms; down payment - 500,000, balance payable every January 1 until fully paid starting 2019. The equipment was estimated to last for 6 years. How much is the VAT payable of JJ for June 30, 2018? a. P360,000 b. P690,000 c. P684,000 d. P0

d. All of the above

Choose the correct statement(s) from the following: a. A non-vat registered person could not claim the input vat on its purchases as tax credit against its business taxes. b. In the books of a vat registered person, the input vat is an asset account. c. Purchases on account from vat registered supplier is a source of creditable input vat. d. All of the above

d. None of the above

JJ owns a mango plantation. He sold his ripe mangoes to Paul, a fresh fruit vendor. Paul sold the ripe mangoes he bought from JJ to Francis. Who shall be subject to VAT? a. JJ b. Paul c. Francis d. None of the above

b. P24,000

Lady sells real property in the course of its business. During the last quarter of 2018, it had sold a parcel of land under the following terms (vat inclusive): Total contract price P1,120,000 Downpayment, 10/05/2018 112,000 1st installment (12/31/2018) 112,000 2nd installment(2/1/2019) 560,000 The output vat in the last quarter of 2018 is a. P12,000 b. P24,000 c. P26,000 d. P0

b. No, because importations, unless exempted, should be subject to vat.

Lester, not a vat registered taxpayer, was sent a package of goods by his friend, Clifford who was abroad. The package was claimed by Lester. The Bureau of Customs required him to pay vat on importation. Lester refused to pay the vat claiming that since he is a non-vat registered person and that the package sent to him is intended for personal use only, he should be exempt from paying input vat on importation. Was Lester's ground in refusing to pay vat correct? a. Yes, because only vat registered importers should be subject to vat. b. No, because importations, unless exempted, should be subject to vat. c. Yes, because the package was intended for personal use, and therefore, he was not an importer. d. No, because Lester may actually sell the package, depriving the BOC to collect the applicable input vat.

c. Be liable to percentage tax, VAT, and a surcharge of 50%

Mr. Juan Dela Cruz, VAT-exempt, issued VAT invoice to Pedro, VAT registered trader. As a consequence, Mr. Juan Dela Cruz would: a. Be liable to VAT without the benefit of input tax credit; b. Not be liable to Vat because he is VAT- exempt; c. Be liable to percentage tax, VAT, and a surcharge of 50% d. Not be liable to any business tax but may be liable to income tax.

a. Subject to VAT

Talion owns Eternal Gardens. He harvested fresh flowers and sold them to Joseph. Joseph sold the flowers in their original state to Alex. The sale of flowers by Joseph to Alex shall be: a. Subject to VAT b. Exempt from VAT c. Exempt from VAT or subject to VAT depending on annual gross receipts of Pedro d. Subject to VAT if Juan did not subsequently sell it.

d. P69,948

The following data during the month relates to William Company, a VAT registered person: Domestic sales, invoice amount P330,OOO Domestic sales to export traders 274,996 Export sales 200,000 Purchases of goods for domestic sales 374,000 Purchases of supplied on domestic sales 69,848 Purchase of service 154,000 Purchase of goods for export. 55,000 Total input tax is a. P20,650 b. P40,350 c. P54,350 d. P69,948

a. (P5,127)

The following data during the month relates to William Company, a VAT registered person: Domestic sales, invoice amount P330,OOO Domestic sales to export traders 274,996 Export sales 200,000 Purchases of goods for domestic sales 374,000 Purchases of supplied on domestic sales 69,848 Purchase of service 154,000 Purchase of goods for export. 55,000 Value added tax payable/excess tax if input taxes on exports are claimed as tax credit a. (P5,127) b. P4,350 c. P19,446 d. P20,650

b. P51,600

The following information and data (net of VAT) are from the records of Fantastic 4 Corporation, a VAT taxpayer in connection with its construction contracts. They cover the third quarter of 2018 taxable year. Accounts Receivable: July 1- 180,000; Sept. 30- 120,000 Retention Receivable: July 1- 90,000; Sept. 30- 85,000 Purchases of Materials: July to Sept. - 480,000 Total Billings for completed works: July to Sept. 850,000 VAT payable for the quarter is (disregard monthly payments) a. P43,000 b. P51,600 c. P37,000 d. P82,500

b. Foreign currency denominated sales

Under the TRAIN law, which of the following sales is not be zero-rated? a. Export sales b. Foreign currency denominated sales c. Sale of goods to the Asian Development Bank d. None of the above

d. Only one invoice for both Vat and non-Vat transactions shall be issued.

Which of the following is not correct pertaining to the transactions of a business which is engaged in Vat and non-Vat transactions? a. Vat invoice shall be issued for vat transactions. b. Non-Vat invoice shall be issued to Non-Vat transactions. c. Separate Vat invoice for the taxable transactions and Non-vat invoice for the Vat exempt transactions. d. Only one invoice for both Vat and non-Vat transactions shall be issued.

a. Non-stock, non-profit private organizations are not subject to VAT if their income from sales is used for non-profit purposes.

Which of the following is not correct? a. Non-stock, non-profit private organizations are not subject to VAT if their income from sales is used for non-profit purposes. b. A VAT registered taxpayer can pass on the VAT even to non-VAT registered buyers c. Any business pursued by an individual where the aggregate gross sales or receipts do not exceed P100,000 during any 12-month period, shall be considered principally for subsistence or livelihood and not in the course of trade or business d. None of the above

c. Franchise grantees of radio broadcasting whose gross receipt for the preceding year was P9,000,000

Which of the following is not subject to VAT? a. Importation of goods in the ordinary course of business b. Importation of items for personal use c. Franchise grantees of radio broadcasting whose gross receipt for the preceding year was P9,000,000 d. VAT-registered person, whose annual gross receipt is less than P3,000,000

d. Sale of olive oil

Which of the following is subject to VAT? a. Sale of vegetables in its original state b. Sale of fruits in its original state c. Sale of copra d. Sale of olive oil

c. He does not have any output tax although he may have an input tax credit which can be claimed for refund

Which of the following is the benefit of a VAT registered taxpayer if he is subject to zero percent (0%) VAT rate? a. Exclusion from tax audit by tax examiner b. Not required to file VAT return whether monthly or quarterly c. He does not have any output tax although he may have an input tax credit which can be claimed for refund d. He is entitled to tax discount equivalent to 20%

a. II and IV only\

Which of the following receipts for 2018 current year from lease of residential units is subject to VAT? I. Monthly rental per unit-P14,000; Aggregate annual rent- P3,150,000 II. Monthly rental per unit-P18,000; Aggregate annual rent- P3,800,000 III. Monthly rental per unit-P18,000; Aggregate annual rent- P3,000,000 IV. Monthly rental per unit-P20,000; Aggregate annual rent- P4,000,000 a. II and IV only b. III and IV only c. All of the above d. None of the above

a. I and II only

Which of the following shall be exempt from value-added-tax? I. Sales by agricultural cooperatives, duly registered with the Cooperative Department Authority to their members as well as sale of their products, whether in its original state or processed form, to non-members II. Gross receipts from lending activities by credit or multi-purpose cooperatives duly registered with the Cooperative Department Authority III. Sales by non-agricultural, non-electric, and non-credit cooperatives duly registered with the Cooperative Department Authority a. I and II only b. I only c. II and III only d. I, II, and III

c. Sale of commercial property by a real estate dealer for P1,500,000

Which of the following shall be subject to VAT? a. Sale of residential house and lot by the owners for P5,000,000 b. Sale of private car by its owner c. Sale of commercial property by a real estate dealer for P1,500,000 d. All of the above

D. None of the above

Which of the following shall not be subject to VAT? I. MP Promotions, VAT registered, but gross sales for the year do not exceed P3,000,000 II. Mayweather Corporation, a foreign licensor or nonresident lessor who is not VAT registered III. Mailag Company, a domestic corporation, required to register under VAT system but failed to register a. MP Promotions and Mayweather Corporation b. MP Promotions and Mailag Company c. All of the above d. None of the above

c. Both I and II

Which of the following statement is correct? I. Certain transactions which are not actually sale because of the absence of actual exchange between the buyer and the seller, are considered sale for VAT purposes II. Output VAT should be imposed on certain transactions which are not actually sale to avoid a situation where a VAT registered taxpayer avail of input VAT credit without being liable for the corresponding output VAT a. I only b. II only c. Both I and II d. Neither I nor II

c. III only

Which of the following statements is correct? I. An importation of goods by a non-profit charitable organization shall not be subject to the value added tax. II. In the case of importation, the importer is not the one liable for the VAT but the person who shall buy the imported goods. III. Non-exempt persons or entities who acquire tax free imported goods from exempt persons, entities or agencies shall be considered the importer for Philippine VAT purposes. a. I only b. I and Il only c. III only d. None of the above

d. Neither I nor II

Which of the following statements is correct? I. Sale to export oriented enterprises is considered export sales under the tax code at the level of the supplier of raw materials only II. Sale of raw materials or packing materials to an export-oriented enterprise is considered export sales only when export sales of such enterprise exceed 70% of total annual production a. I only b. II only c. Both I and II d. Neither I nor II

a. Export sale by a VAT registered person is subject to 0% VAT

Which of the following statements is correct? a. Export sale by a VAT registered person is subject to 0% VAT b. Export sale by a non-VAT registered person is subject to 3% percentage tax c. Both a and b c. Neither a nor b

c. Both a and b

Which of the following statements is correct? a. Under RA 7916, while an economic zone registered under PEZA is geographically within the Philippines, it is deemed a separate customs territory and is regarded in law as foreign soil b. Sales by suppliers from outside the borders of the economic zones to the entities within the separate customs territory are deemed as exports and treated as export sales c. Both a and b d. Neither a nor b

b. For the purposes of claiming input tax, as a purchase of service, the value of which shall be determined based on the progress billing

Which of the following statements is false? a. Construction in progress is not depreciated until the asset is placed in service b. For the purposes of claiming input tax, as a purchase of service, the value of which shall be determined based on the progress billing c. The input tax credit on the labor contracted shall be recognized on the month the payment was made based on the progress billing d. Once the input tax has already been claimed while the construction is still in progress, no additional input tax can be claimed upon completion of the asset when it has been reclassified as depreciable capital asset and depreciated

c. Must be allocated immediately and at the time of purchases between the VAT and Non-VAT business.

Which of the following statements is wrong? When a purchase from a VAT-registered person is for use both in the VAT and Non-VAT business of purchaser, the VAT component of the total amount paid for the purchase: a. May be debited at the time of purchase to the Input Taxes account. b. May be debited at the time of purchase to the Purchases account. c. Must be allocated immediately and at the time of purchases between the VAT and Non-VAT business. d. Must be allocated between the VAT and Non-VAT business at the end of the taxable period.

c. Services arising from employee-employer relationship

Which of the following transactions is exempt from VAT? 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

a. Sale of books, newspaper, and magazines

Which of the following transactions is exempt from VAT? a. Sale of books, newspaper, and magazines b. Sale of literary works c. Sale of musical compositions d. All of the above

c. Sale of coal and natural gas

Which of the following transactions is subject to value-added-tax? a. Services subject to other percentage tax b. Educational services duly approved by DEP-ED, CHED, and TESDA or those operated by the government c. Sale of coal and natural gas d. None of the above

d. All of the above

Which statement is correct? Leasing of property shall be subject to value added tax on sale of services: a. If the property is in the Philippines and the lease agreement was executed in the Philippines b. If the property is in the Philippines and the lease agreement was executed outside the Philippines c. If the property is in the Philippines and the lease agreement was executed within or outside the Philippines d. All of the above

d. May be due even in the absence of actual sale

Which statement is correct? The output value added tax on goods or properties sold: a. Is based on gross sales and not on net sales b. Is not imposed on goods exported c. Is imposed on actual sale only d. May be due even in the absence of actual sale

c. The excess input taxes of a taxable period arising from domestic sales may be refunded.

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.

c. VAT taxpayer from being VAT exempt or non-VAT taxpayer.

Who may claim transitional input tax as tax credit against output tax? a. Processor or manufacturer of cooking oil or refined sugar. b. Those whose transaction is subject to zero percent VAT. c. VAT taxpayer from being VAT exempt or non-VAT taxpayer. d. Those who sell goods or services to persons or entities whose exemption from tax is provided by special law or by international agreement to which the Philippines is a signatory.

a. I only

A lessor of commercial units shall be exempt from VAT when: I. Annual gross receipts do not exceed P3,000,000 II. Monthly rental per unit does not exceed P15,000 a. I only b. II only c. Either I and II d. Both I and II

c. Either I and II

A lessor of residential units shall be exempt from VAT when: I. Annual gross receipts do not exceed P3,000,000 II. Monthly rental per unit does not exceed P15,000 a. I only b. II only c. Either I and II d. Both I and II

d. P4,320

A VAT-registered person is engaged in the sale of VAT taxable goods and at the same time is also engaged in non-VAT business, in the same business establishment. During the quarter, the taxpayer made sales of goods in the amount of P336,000 inclusive of vat. The sales of the non VAT business amounted to P200,000 with a separate percentage tax of P6,000 for a total of P206,000. During the same quarter, repairs in the building amounted to P56,000 inclusive of vat. Supplies purchased for common use amounted to P11,200 inclusive of vat. The creditable input tax is: a. P6,000 b. P5,000 c. P1,200 d. P4,320

c. P31,680

A VAT-registered person is engaged in the sale of VAT taxable goods and at the same time is also engaged in non-VAT business, in the same business establishment. During the quarter, the taxpayer made sales of goods in the amount of P336,000 inclusive of vat. The sales of the non VAT business amounted to P200,000 with a separate percentage tax of P6,000 for a total of P206,000. During the same quarter, repairs in the building amounted to P56,000 inclusive of vat. Supplies purchased for common use amounted to P11,200 inclusive of vat. The vat payable is: a. P25,000 b. P30,000 c. P31,680 d. P34,800

b. P324,000

A dealer in securities has the following for the year 2018: Sales, shares held for sale in the ordinary course of trade or business P5,000,000 Sales, shares held as capital asset 1,500,000 Cost of shares, held for sale in the ordinary course of trade or business 2,000,000 Cost of shares, held as capital asset 500,000 Supplies expense, net of VAT 100,000 Rent expense, net of VAT 200,000 How much is the net VAT payable? a. P470,000 b. P324,000 c. P270,000 d. VAT exempt

a. Claimed as input tax credit in its entirety during the month or quarter when the sale or transfer was made.

If the depreciable capital good is sold or transferred within a period of 5 years or prior to the exhaustion of the amortizable input tax thereon, the unamortized input tax on the capital goods sold or transferred can be: a. Claimed as input tax credit in its entirety during the month or quarter when the sale or transfer was made. b. Amortized over the remaining life of the capital good. c. Claimed as input tax credit in its entirety or amortized over the remaining life of the capital good at the option of the taxpayer. d. Expensed outright in the month or quarter the sale or transfer was made.

b. Subject to VAT

On January 1, 2018, Pedro purchased a condominium unit including a parking space worth P4,200,000 from Maxima Realty Corporation. The value of the condominium unit, as stated in the contract of sale was P3,200,000 while the parking space was worth P1,000,000. The transaction a. Exempt from VAT b. Subject to VAT c. Subject to 0% VAT d. None of the above

b. Subject to VAT

On January 1, 2018, Pedro purchased a condominium unit worth P2,000,000 from Maxima Realty Corporation. A month after, Pedro purchased the adjacent unit for the same consideration. The purchased of the second (adjacent unit) is a. Exempt from VAT b. Subject to VAT c. Subject to 0% VAT d. None of the above

a. First day of the month following the registration

Once optionally registered as a vat person, the taxpayer shall be liable to output tax and be entitled to input tax credit beginning on the a. First day of the month following the registration b. First day of the month following the close of the first quarter after registration. c. Tenth day of the month following the close of the first quarter after registration. d. Twenty fifth day following the close of the quarter.

d. Refined brown sugar

One of the following goods is not in its original state: a. Salted eggs b. Corn grits c. Polished or husked rice d. Refined brown sugar

b. Distribution or transfer to creditors in payment of debt.

One of the following is a transaction deemed sale under value added tax. a. Transfer, use or consumption in the course of business of goods or properties intended for sale or for use in the course of business. b. Distribution or transfer to creditors in payment of debt. c. Consignment of goods if actual sale is not made within forty (40) days from the date the goods were consigned. d. Retirement from or cessation of business with respect to beginning inventories of taxable goods existing as of such retirement or cessation.

a. Export sale of a person who is VAT registered

One of the following is a zero-rated sale under the TRAIN Law a. Export sale of a person who is VAT registered b. Sale of nonfood agricultural products c. Sale of gold to Bangko Sentral ng Pilipinas d. Sale of cotton and cotton seeds

d. Race horse

One of the following is not a livestock for VAT purposes: a. Rabbit b. Cow c. Pig d. Race horse

d. Fighting cock

One of the following is not a poultry for VAT purposes: a. Duck b. Fowl c. Goose d. Fighting cock

d. Goods exempt from customs duties classified as personal and household effects belonging to residents of the Philippines returning from abroad

One of the following is not subject to VAT on importation: a. Goods brought into the Philippines in the course of trade or business by VAT registered person b. Goods brought into the Philippines in the course of trade or business by a person who is not VAT registered c. Tax free goods imported by tax-exempt importer who transferred them to a person who does not enjoy exemption from VAT on importation d. Goods exempt from customs duties classified as personal and household effects belonging to residents of the Philippines returning from abroad

d. Taxpayers who elect to revert to being a vat exempt from being vat subject.

One of the following shall not be entitled to transitional input tax a. Taxpayers who become liable to vat for the first time under a new legislation. b. Taxpayers who are already vat registered person and also deal in goods or property, the sale of which is exempt but becomes vatable transaction under a new amendatory law. c. Taxpayers whose taxable transactions exceeded the vat registration threshold of P3,000,000 d. Taxpayers who elect to revert to being a vat exempt from being vat subject.

c. I, Il and Ill only

Persons or firms engaged in the processing of sardines, mackerel and milk, and in manufacturing refined sugar and cooking oil shall be allowed. I. Creditable input tax II. Transitional input tax III. Presumptive input tax IV. Refundable input tax a. I only b. I and Il only c. I, Il and Ill only d. 1, 11, 111 and IV

c. 25th day from the end of each quarter

Quarterly VAT return is filed on or before the: a. 15th day from the end of each quarter b. 20th day from the end of each quarter c. 25th day from the end of each quarter d. 30th day from the end of each quarter

c. P120,000

Serbesa Company is a manufacturer of local beer. During a particular quarter, it had the following transactions (net of VAT): Jan. 2: Consigned beer to a retailer in Quezon City amounting to P200,OOO Feb. 14: Exported P1,000,000 worth of beer to UK. Feb. 27: President of Serbesa Company celebrated his birthday, consuming P50,000 worth of beer given to him by the company as a birthday gift. Mar. 20: Declared property dividend of one case of beer for every 10 shares amounting to P150,000. Additional Information: From January to March, domestic sales to wholesalers amounted to P600,000. No beer was returned by the consignee until the end of the quarter. The output tax for the quarter is: a. P48,000 b. P72,000 c. P120,000 d. P192,000

d. Statements 1 and 2 are true

Statement 1: If the sale involves goods, properties or services some of which are subject to and some of which are VAT zero-rated or VATexempt, the invoice or receipt shaH clearly indicate the break-down of the sales price between its taxable, exempt and zero-rated components, and the calculation of the VAT on each portion of the sale shall be shown on the invoice or receipt. Statement 2: The seller has the option to issue separate invoices or receipts for the taxable, exempt, and zero-rated components of the sale. a. Statements 1 & 2 are false b. Statement 1 is true but statement 2 is false c. Statement 1 is false but statement 2 is true d. Statements 1 and 2 are true

d. Statements 1 and 2 are true

Statement 1: In the case of sale on deferred payment basis not qualifying under the installment plan, the transaction shall be treated as cash sale and the Vat is payable on the month of sale. Statement 2: In the case of a sale on deferred payment basis not qualifying under the installment plan, payments subsequent to the initial payments shall no longer be subject to vat. a. Statements 1 & 2 are false b. Statement 1 is true but statement 2 is false c. Statement 1 is false but statement 2 is true d. Statements 1 and 2 are true

d. Statements 1 and 2 are true

Statement 1: On a sale of real property on installments by a real estate dealer, the seller shall be subject to VAT on the installment payment received, including interests and penalties for late payment. Statement 2: On sale of real property on installments by real estate dealer, where the Vat is computed not on the consideration in the deed of sale but on the higher fair market value, the Vat must be billed separately with a specific mention that it is based on the market value of the property. a. Statements 1 & 2 are false b. Statement 1 is true but statement 2 is false c. Statement 1 is false but statement 2 is true d. Statements 1 and 2 are true

d. Statements 1 and 2 are true

Statement 1: The government or any of its political subdivisions instrumentalities or agencies, including government-owned or controlled corporations (GOCCs) shall, before making payment on account of each purchase of goods and/or services subject to VAT, deduct and withhold a final VAT due at the rate of five percent (5%) of the gross payment thereof. Statement 2: The five percent (5%) final VAT withholding rate shall represent the net VAT payable of the seller. a. Statements 1 & 2 are false b. Statement 1 is true but statement 2 is false c. Statement 1 is false but statement 2 is true d. Statements 1 and 2 are true

a. Statements 1 & 2 are false

Statement 1: The input value-added-tax on purchase of capital goods valued at P1,000,000 shall be spread over 60 months if the life of property is equivalent to 5 years or more. Statement 2: The input value-added tax on purchase of capital goods valued at P1,000,000 shall be spread over the life of property if the life of property is less than 5 years. a. Statements 1 & 2 are false b. Statement 1 is true but statement 2 is false c. Statement 1 is false but statement 2 is true d. Statements 1 and 2 are true

c. P19,200

Use the following data for the next two (2) questions: A Vat taxpayer had the following data on its operations for the month of January: Sales, total invoice price P592,480 Purchases of goods, Vat not included: From Vat registered persons 100,000 From non-vat registered persons 80,000 Purchases of services, Vat not included: From Vat registered persons 20,000 From non-vat registered persons 8,000 From persons subject to percentage taxes 10,000 Salaries of employees 60,000 Other operating expenses 12,000 This is the first month of being liable to the value added tax. Data on inventories at the beginning of the period bought from VAT registered persons follow: Inventory at cost P44,800 Inventory at net realizable value 49,000 Value added tax paid on beginning inventory 4,800 Input Taxes are a. P24,800 b. P20,400 c. P19,200 d. P19,650

b. P44,280

Use the following data for the next two (2) questions: A Vat taxpayer had the following data on its operations for the month of January: Sales, total invoice price P592,480 Purchases of goods, Vat not included: From Vat registered persons 100,000 From non-vat registered persons 80,000 Purchases of services, Vat not included: From Vat registered persons 20,000 From non-vat registered persons 8,000 From persons subject to percentage taxes 10,000 Salaries of employees 60,000 Other operating expenses 12,000 This is the first month of being liable to the value added tax. Data on inventories at the beginning of the period bought from VAT registered persons follow: Inventory at cost P44,800 Inventory at net realizable value 49,000 Value added tax paid on beginning inventory 4,800 The value added tax payable is a. P43,830 b. P44,280 c. P46,680 d. P59,248

d. P0

Use the following data for the next two 2 questions: Ivan, vat registered real estate dealer sold a residential lot on October 2018. The following information was made available on the terms of the sale: Gross selling price - P3,000,000 Initial payments consisting of down payment and installments in the year of sale - 900,000 Balance to be paid in equal installments of P700,000 - 2,100,000 starting January 2019 The zonal value of the residential lot was P2,800,000 How much was the output tax due on January 2019? a. P360,000 b. P300,000 c. P108,000 d. P0

a. P360,000

Use the following data for the next two 2 questions: Ivan, vat registered real estate dealer sold a residential lot on October 2018. The following information was made available on the terms of the sale: Gross selling price - P3,000,000 Initial payments consisting of down payment and installments in the year of sale - 900,000 Balance to be paid in equal installments of P700,000 - 2,100,000 starting January 2019 The zonal value of the residential lot was P2,800,000 How much was the output tax due on October 2018? a. P360,000 b. P300,000 c. P108,000 d. P0

d. P265,780

Villamin Grill, a VAT registered business in Cavite, has the following data (exclusive of VAT) for the third quarter of the current year. Sales, food and beverages P2,805,500 Sales, wines and beer 1,524,000 Purchases, food and beverages - VAT business 1,102,200 Purchases, wines and beer - VAT business 1,012,500 The VAT payable due for the third quarter is a. P201,340 b. P211,470 c. P221,480 d. P265,780

c. Transport of passenger and cargo by a domestic carrier (air or sea) from the Philippines to a foreign country.

Which among the following is subject to zero percent VAT? a. Sale, importation or lease of passenger or cargo vessel and aircraft including engine, equipment and spare parts thereof for domestic or international transport operations b. Importation of fuel, goods, and supplies by persons engaged in international shipping or transport operations c. Transport of passenger and cargo by a domestic carrier (air or sea) from the Philippines to a foreign country. d. All of these

b. Gross receipts

Which is true? On sale of service, the tax base in computing for the VAT is a. Gross selling price b. Gross receipts c. Amount per invoice d. Amount shown in the official receipt

b. Manufacturer of packed noodles

Which of the following businesses is allowed a presumptive input vat? a. Manufacturer of canned goods. b. Manufacturer of packed noodles c. Manufacturer of packed juices d. Manufacturer of dried fish

d. All of the above

Which of the following importation is subject to value added tax? a. Importation for personal use of the importer b. Importation intended for resale c. Importation of machinery for the importers factory d. All of the above

d. Facilitation expense

Which of the following is not a proper inclusion for the computation of VAT on imported items? a. Custom duties on importation b. Excise tax on importation c. Invoice price of the imported items d. Facilitation expense

d. Consignment sales.

Which of the following is not a sale and therefore is not subject to the value-added tax? a. Transfer, use or consumption not in the ordinary course of business of goods or properties ordinarily intended for sale or use in the course of business. b. Distribution or transfer to shareholders or investors of share in the profits of a VAT-registered person. c. Distribution or transfer to creditors in payment of debt. d. Consignment sales.