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TAXATWO TEST BANK-VALUE ADDED TAX (VAT) A.MULTIPLE CHOICE: 1. A TAX ON BUSINESS IS A A. B. C. D.

DIRECT TAX INDIRECT TAX PROPERTY TAX NONE OF THE ABOVE

2. ONE OF THE FOLLOWING IS NOT A MAJOR BUSINESS INTERNAL REVENUE TAXES IN THE TAX CODE A) B) C) D) VALUE-ADDED TAX EXCISE TAX INCOME TAX PERCENTAGE TAX

3. VALUE-ADDED TAX IS A(AN) A) B) C) D) INDIRECT TAX DIRECT TAX PROGRESSIVE TAX REGRESSIVE TAX

. IN VAT TAXATION! THIS IS NOT A RE"UIREMENT FOR TAXABILITY OF SERVICE A) B) C) D) IN THE COURSE OF BUSINESS PERFORMED WITHIN OR OUTSIDE THE PHILIPPINES CONSIDERATION RECEIVED ACTUALLY OR CONTRUCTIVELY SUPPLY OF SERVICE IS NOT EXEMPT FROM VAT

#. CHARLIE IS AN OPERATOR OF PAR$ING LOTS. WHAT BUSINESS TAX IS DUE ON HIS INCOME FROM THE BUSINESS% A) B) C) D) BRO$ER&S TAX CATERER&S TAX COMMON CARRIER&S TAX VAT

'. MR. F IS A LESSOR OF REAL PROPERTY AND PERSONAL PROPERTY(CARS). THE TAX THAT HE PAYS IS A) B) C) D) EXCISE TAX VAT PERCENTAGE TAX NONE OF THE ABOVE

(. MR. S. MAGLER IMPORTED CIGARETTES FROM THE U.S. FOR SALE IN THE PHILIPPINES. WHAT BUSINESS TAXES IN THE PHILIIPINES ARE DUE% A) B) C) D) VAT! EXCISE TAX! OTHER PERCENTAGE TAX VAT AND EXCISE TAX OTHER PERCENTAGE TAX AND EXCISE TAX VAT AND PERCENTAGE TAX

). STATEMENT 1* FOR PURPOSES OF THE THRESHOLD OF P1!#++!+++! THE HUSBAND AND WIFE ARE CONSIDERED AS SEPARATE TAXPAYERS STATEMENT 2* THE SELLER OF GOODS OR SERVICES IS THE ONE STATUTORILY LIABLE FOR THE PAYMENT OF VAT BUT THE AMOUNT OF THE TAX MAY BE SHIFTED OR PASSED TO THE BUYER! TRASFEREE OR LESSEE OF THE GOODS! PROPERTIES OR SERVICES A) B) C) D) TRUE! FALSE FALSE! TRUE FALSE! FALSE TRUE! TRUE

,. THE FOLLOWING ARE DATA OF SPOUSES FIDEL AND AILEEN DURING THE YEAR* GROSS RECEIPTS FROM BUSINESS* RESTAURANT SMALL DEPT. STORE PRACTICE OF PROFESSION AS A CPA FIDEL 1!3#+!+++ 1!22+!+++ 2# !3++ AILEEN

WHICH OF THE FOLLOWING STATEMENTS IS CORRECT% A) FOR PURPOSES OF THE THRESHOLD OF P1.# MILLION THE GROSS RECEIPTS OF FIDEL AND AILEEN SHALL BE COMBINED

B) AILEEN SHALL BE SUBJECT TO VAT EVEN IF SHE DOES NOT REGISTER VOLUNTARILY UNDER THE VAT SYSTEM C) FOR PURPOSES OF THE THRESHOLD OF P1.# MILLION! THE RESTAURANT AND THE PRACTICE OF PROFESSION ARE CONSIDERED AS SEPARATE TAXPAYERS D) FOR PURPOSES OF THE THRESHOLD OF P1.# MILLION! THE AGGREGATION RULE FOR EACH TAXPAYER SHALL APPLY. THUS! THE GROSS RECEIPTS FROM THE RESTAURANT SHALL BE ADDED TO THE RECEIPTS FROM THE PRACTICE OF PROFESSION 1+. $AREN IS A PRACTICING CPA. SHE IS ALSO A FULL TIME PROFESSOR OF ACCOUNTING IN ATENEO DE NAGA UNIVERSITY. IN THE PRECEDING YEAR! HER GROSS RECEIPTS FROM THE PRACTICE OF PUBLIC ACCOUNTING WAS P1! ++!+++ WHILE HER TOTAL COMPENSATION INCOME AS COLLEGE PROFESSOR WAS P1,#!+++. WHICH OF THE FOLLOWING STATEMENTS IS CORRECT% A) SHE IS SUBJECT TO VAT EFFECTIVE JANUARY 1 OF THE CURRENT YEAR B) SHE MAY BE SUBJECT TO VAT IF SHE VOLUNTARILY REGISTERS UNDER THE VAT SYSTEM C) SHE IS NOT RE"UIRED TO PAY EITHER VAT OR ANY BUSINESS TAX D) SHE IS RE"UIRED TO PAY PRIVELEGE TAX RECEIPT BUT NOT BUSINESS TAX 11. THREE OF THE FOLLOWING ARE VAT-EXEMPT. WHICH IS THE EXCEPTION% A) SALES OR IMPORTATION OF MEDICAL! DENTAL AND VETERINARY MEDICINES B) SERVICES RENDERED BY PERSONS SUBJECT TO PERCENTAGE TAX C) RECEIPTS FROM LEASING OF REAL PROPERTIES D) EXPORT SALES BY PERSONS WHO ARE NOT VAT-REGISTERED 12. WHICH OF THE FOLLOWING IS NOT VAT-EXEMPT% A) IMPORTATION IN THEIR ORIGINAL STATE OF AGRICULTURAL AND MARINE FOOD PRODUCTS B) IMPORTATION OF PASSSENGER OR CARGO VESSEL OF MORE THAN #!+++ TONS TO BE USED BY THE IMPORTER HIMSELF AS OPERATOR THEREOF C) IMPORTATION OF PERSONAL AND HOUSEHOLD EFFECT BELONGING TO PHIL. RESIDENTS RETURNING FROM ABROAD D) IMPORTATION OF NON-FOOD AGRCULTURAL PRODUCTS IN THEIR ORIGINAL STATE BY A PRIMARY PRODUCER

13. ONE OF THE FOLLOWING TRANSACTIONS BY A VAT-REGISTERED PERSON DOES NOT RESULT TO OUTPUT VAT A) B) C) D) CASH SALES SALES ON ACCOUNT SALES AND LEASEBAC$ EXPORT SALES

B. PROBLEM SOLVING 1. ABC COMPANY! A VAT -REGISTERED BUSINESS! HAD THE FOLLOWING DATA DURING THE "UARTER* EXPORT SALES DOMESTIC SALES(TAX INCLUDED) PURCHASES OF GOODS FOR EXPORT PURCHASES OF GOODS FOR DOMESTIC SALES PURCHASES OF SUPPLIES ON DOMESTIC SALES! EXCLUSIVE OF TAX P1!)1#!+++ 1!232!+++ '(2!+++ 323!12+ 12 !)#+

ASSUMING THAT THE INPUT TAXES PAID ON PURCHASES OF GOODS FOR EXPORT ARE CLAIMED AS TAX CREDIT! THE VAT PAYABLE BY ABC COMPANY IS A) B) C) D) 12!),# 1+!3,) 1((!),# ) !),#

2. IN RELATION TO NO. 1 ABOVE! ASSUMING THAT THE INPUT TAXES ATRIBUTABLE TO EXPORT SALES ARE BEING CLAIMED AS REFUND! THE AMOUNT REFUNDABLE IS A) B) C) D) (2!+++ 12!),# ) !),# .ERO

3. JOEY! A NON-VAT TAXPAYER! PURCHASED MERCHANDISE WORTH P11!2++! VAT INCLUSIVE. FROM WILLIE! A VAT-REGISTERED SELLER. THE PASSED ON VAST OF P1!2++ ON THE PURCHASES IS A) AN EXPENSE B) PART OF THE COST OF PURCHASES C) A TAX CREDIT

D) IGNORED . ALTURA SOLD GOODS AT AN INVOICE PRICE OF P123!2++ TO BELTRAN ON ACCOUNT. BELTRAN SOLD THE SAME GOODS TO CANTORIA FOR P1 3!+++ (EXCLUSIVE OF TAX) CASH. ALL OF THEM ARE VAT-REGISTERED TAXPAYERS. THE ACCOUNTING ENTRY TO RECORD THE SALES IN THE BOO$S OF BELTRAN IS A) CASH 1'+!1'+ SALES OUTPUT TAX(1 3!+++ X 12/) B) CASH SALES C) CASH SALES D) CASH SALES OUTPUT TAX 1 3!+++ 1 3!+++ 1'+!1'+ 1'+!1'+ 1 3!+++ 12#!) + 1(!1'+ 1 3!+++ 1(!1'+

#. THE JOURNAL ENTRY IN THE PURCHASE BOO$S OF BELTRAN IN NO.! ABOVE IS A) PURCHASES INPUT TAX ACCOUNTS PAYABLE B) PURCHASES ACCOUNTS PAYABLE C) PURCHASES INPUT TAX ACCOUNTS PAYABLE D) PURCHASED ACCOUNTS PAYABLE 11+!+++ 13!2++ 123!2++ ,'!)++ ,'!)++ )3!'++ 13!2++ ,'!)++ 11+!+++ 11+!+++

'. IN "UESTION NO. ABOVE! ASSUMING THAT CANTORIA IS NOT SUBJECT TO VAT. IN THE SALE OF THE GOODS BY BELTRAN TO CANTORIA A) BELTRAN SHOULD RECORD DEBIT CASH OF P12#!) + B) BELTRAN SHOULD RECORD DEBIT CASH OF P1 3!+++ IN HIS BOO$S

C) CANTORIA SHOULD DEBIT PURCHASES OF P12#!) + AND A DEBIT INPUT TAX OF P1(!1'+ D) CANTORIA SHOULD DEBIT PURCHASES OF P1 3!+++ (. 1ST STATEMENT* IN CASE TAX EXEMPT PRODUCTS ARE SOLD DOMESTICALLY TO A VAT REGISTERED PERSON! THE VAT OTHERWISE DUE ON SUCH PRODUCT SHALL BE CONSIDERED AS INPUT TAX CREDITABLE AGAINST HIS OUTPUT TAX PAYABLE 2ND STATEMENT* EXPORT SALES BY A VAT-REGISTERED PERSON ARE SUBJECT TO .ERO-RATING AND SO HE CAN CLAIM AND ENJOY A CREDIT FOR THE TAX INVOICED TO HIM ON HIS PURCHASES. IF HE IS NOT VATREGISTERED! HIS EXPORT SALES ARE EXEMPT! BUT HE IS NOT ENTITLED TO TAX CREDIT FOR INPUTS A) B) C) D) TRUE! TRUE FALSE! TRUE FALSE! FALSE TRUE! FALSE

NUMBER 8 THROUGH 10 ARE BASED ON THE FOLLOWING INFORMATION: TRANSACTION 1-AN AGRICULTURAL FOOD PRODUCER SELLS HIS PRODUCTS IN THEIR ORIGINAL STATE TO A FOOD PROCESSOR WHO ALSO BUYS PAC$AGING MATERIALS AND CONTAINERS FROM A MANUFACTURER0SUPPLIER TRANSACTION 2-THE FOOD PROCESSOR TRANSFORMS THE FOOD PRODUCTS INTO PROCESSED FOODS AND SELLS TO A WHOLESALER0EXPORTER TRANSACTION 3- THE EXPORTER SELLS THE GOODS TO FOREIGN BUYERS TRANSACTION - THE WHOLESALER DEL$IVERS THE MERCHANDISE TO RETAILERS TRANSACTION #- THE RETIALERS SELL THE GOODS TO HOUSEHOLDS OR ULTIMATE CONSUMERS ). WHICH OF THE ABOVE TRANSACTIONS IS VAT-EXEMPT% A) B) C) D) 11 12 13 1

,. WHICH IS .ERO-RATED% A) B) C) D) 11 12 13 1

1+. BASED ON NO., ABOVE! THE VAT ARE ABSORBED BY A) B) C) D) FOOD PROCESSOR WHOLESALER0EXPORTER RETAILER HOUSEHOLDS0ULTIMATE CONSUMER

NUMBERS 11 AND 1 ARE BASED ON THE FOLLOWING INFORMATION 11. THE PASTRY SHOP SELLS CA$ES AND PASTRY ITEMS TO WELL$NOWN HOTELS AROUND METRO MANILA AREA. THE HOTELS ARE ALLOWED CREDIT BASED ON THE TRAC$ RECORD OF THE HOTELS. THE TOTAL AMOUNTS RECEIVED OR RECEIVABLE FROM SALES BY THE PASTRY SHOP IN THE 2ND "UARTER OF 2++) WERE P22 !+++! INCLUDING THE VAT. SEVENTY FIVE PERCENT OF THE SALES ARE NORMALLY ON ACCOUNT. HOW MUCH IS THE VAT ON THE SALES FOR THE 2ND "UARTER OF 2++)% A) B) C) D) P2+!+++ P2 !+++ P2'!))+ P1#!+++

12. THE ACCOUNT TITLE TO BEST REFLECT THE VAT IN 111 ABOVE A) B) C) D) SALES TAX PAYABLE VAT PAYABLE INPUT TAX OUTPUT TAX

NUMBERS 1! THROUGH 1" ARE BASED ON THE FOLLOWING INFORMATION: MONGOLIA COMPANY! A VAT-REGISTERED BUSINESS HAS THE FOLLOWING DATA IN ITS BOO$S ON JULY! 2++)* DOMESTIC SALES SALES RETURNS P(+,!#++ 2'! ++

GOODS SHIPPED ON CONSIGNMENT(NET OF TAX) UNITS UNIT PRICE JULY # 2# 22!+++ JUNE # 2+ 22!+++ MAY # 12 22!+++ GOODS W0DRAWN FOR COMPANY USE GOODS TA$EN AS PAYMENT FOR CREDITOR FREIGHT AND INSURANCE OF GOODS PURCHASES* RAW MATERIALS SUPPLIES CAPITAL GOODS SALARIES OF EMPLOYEES 3)!#++ 2'!,#+ !'(# ) !+++ '1!'++ '+!#++ 23#!+++

DURING THE MONTH! ONE CONSIGNEE REMITTED CASH NET OF 2+/ COMMISSION REPRESENTING PAYMENT FOR FIVE(#) UNITS DELIVERED ON JUNE #. ANOTHER CONSIGNEE REMITTED CASH OF P22+!+++! GROSS OF 2+/ COMMISSION! REPRESENTING PAYMENT FOR TEN(1+) UNITS SOLD IN JULY. OTHER THAN THE COMMISSION! MONGOLIA COMPANY GAVE #/ DISCOUNT 0REBATE TO THE CONSIGNEE FOR SELLING TEN(1+) UNITS IN A ONE MONTH PERIOD. 13. THE OUTPUT TAX IN JULY IS A) B) C) D) P12 ! #+ P121!+#+ P1'1!1+' P13 !2##

1 . THE INPUT TAX IS A) B) C) D) '1!+() (3!,23 '#! + NONE OF THE ABOVE

1#. THE AMOUNT OF VAT PAYABLE IS A) B) C) D) )(!)13 ',!3#+ ''!#2# ()! + . '

1'. A CREDITABLE INPUT TAX ON ONE WHO BECOMES SUBJECT TO VAT FOR THE FIRST TIME A) B) C) D) PRESUMPTIVE INPUT TAX TRANSITIONAL INPUT TAX EXCESS INPUT TAX TOTAL INPUT TAX

1(.ISAAC COMPANY! A NEWLY VAT REGISTERED BUSINESS! HAS THE FOLLOWING DATA IN JANUARY (ALL AMOUNTS ARE INCLUSIVE OF TAX) MERCHANDISE INVENTORY ACTUAL AMOUNT PAID ON THE INVTY SALES! TOTAL INVOICE AMOUNT PURCHASES 2+ !+++ 1'!+++ ',!+++ #(! ++

FIFTY PERCENT (#+/) OF THE MDSE INVTY ON JANUARY 1 WERE PURCHASED FROM NON-VAT RWGISTERED SELLERS THE VAT PAYABLE BY ISAAC COMPANY IS A) B) C) D) 3+!1++ 2)!1++ 3!,'+ !,#+

1(. AN OWNER OF HEAVY E"UIPMENTS IS ENGAGED IN E"UIPMENT RENTAL. IT USED TO BE VAT-EXEMPT BECAUSE ITS ANNUAL RECEIPTS NEVER EXCEEDED P1!#++!+++. ON JANUARY 2! 2++)! IT DECIDED TO REGISTER UNDER THE VAT SYSTEM. THE FOLLOWING DATA WERE FROM THE FIRST "UARTER ENDING MARCH 31! 2++)* RENTAL FROM HEAVY E"UIPMENTS OF 12/ VAT PURCHASES OF SUPPLIES(FEBRUARY) GROSS OF VAT INVENTORY OF SUPPLIES* SUBJECT TO VAT JAN. 1! 2++) NOT SUBJECT TO VAT VAT PAID ON THE INVTY OF SUPPLIES! JAN. 1! 2++) 33'!+++ 112!+++ #+! ++ '+!+++ #! ++

THE VAT PAYABLE FOR THE "UARTER ENDING MARCH 2++) IS A) 12!1(1 B) 33!(,2 C) 1)!'++ D) 22!,,2

1). STATEMENT 1* TRANSPORT OF PASSENGERS AND CARGO BY DOMESTIC AIR OR SEA VESSELS FROM THE PHIL. TO A FOREIGN COUNTRY IS SUBJECT TO VAT AT A RATE OF +/ STATEMENT 2* TRANSPORT OF PASSENGERS AND CARFO BY DOMESTIC AIR OR SEA VESSELS FROM MINDANAO TO LU.ON AND VISAYAS! VICE VERSA! IS SUBJECT TO VAT AT A RATE OF 12/ A) B) C) D) TRUE! FALSE FALSE! TRUE FALSE! FALSE TRUE! TRUE

1,. BETH HAD THE FOLLOWING RECEIPTS DURING THE MONTH (EXCLUSIVE OF TAX)* JEEPNEY 1 JEEPNEY 2 BUS SEA VESSEL CESSNA PLANE FOR HIRE PASSENGER 2+!+++ 3+!+++ 1#!+++ 1!#++!+++ )++!+++ CARGO )!#++ )++!+++ #'+!+++

THE OUTPUT TAX DURING THE PERIOD IS A) 1' !22+ B) 1!+++ C) 2)3!)++ D) +!22+ 2+. INSIDE JOB SECURITY IS ENGAGED IN THE SELLING OF SECURITY SERVICES TO VARIOUS CLIENTS. DURING THE MONTH OF DECEMBER! IT BILLED ONE OF ITS CLIENTS OF THE FOLLOWING* MONTHLY SALARY 13TH MONTH PAY AGENCY FEE AT 1#/ SSS AND PHILHEALTH LEAVE WITH PAY TOTAL '!+++ '!+++ 1!)++ 3++ #+ 1 !##+

BASED ON THE ABOVE DATA! HOW MUCH IS THE OUTPUT TAX PAYABLE OF INSIDE JOB SECURITY% A) B) C) D) 1!( ' 1!##).,3 1! + 1! ().#(

21. BONNEVIE IS A REAL ESTATE DEALER. DURING THE MONTH OF NOVEMBER 2++)! HE SOLD THREE(3) LOTS UNDER THE FOLLOWING TERMS* LOT1 LOT2 LOT3 SELLING PRICE 2#+!+++ 2++!+++ 3++!+++ COST 1#+!+++ 13+!+++ 1(#!+++ GAIN0LOSS 1++!+++ (+!+++ 12#!+++ TERMS* DP! NOV # DUE* DEC. # JAN TO DEC. 2++, 2#!+++ 2#!+++ 2++!+++ #+!+++ 2+!+++ 13+!+++ +!+++ 2+!+++ 2 +!+++

ALL AMOUNTS INDICATED ABOVE DO NOT INCLUDE THE TAX. THE VAT IN NOVEMBER IS A) B) C) D) 2'!#++ 31!)++ 3 !)++ ,+!+++

22. BASED ON NO. 21 ABOVE! THE VAT FOR THE MONTH OF DECEMBER IS A) B) C) D) #! ++ !#++ 1+!+++ NONE

23. DIMAGIBA CONSTRUCTION COMPANY ENTERED INTO A CONTRACT WITH THE GOV&T TO CONSTRUCT AN EDIFICE FOR A TOTAL CONTRACT PRICE OF P2#!+++!+++. DURING THE MONTH! THE GOVERNMENT PAID P1+!+++!+++ OF WHICH IT WITHHELD #/ FINAL VAT WITHHOLDING TAX. HOW MUCH IS THE VAT PAYABLE BY THE COMPANY ON THE GOVERNMENT CONTRACT% A) B) C) D) 1#+!+++ )#+!+++ .ERO 1!+++!+++

2 . WHICH OF THE FOLLOWING STATEMENTS IS NOT CORRECT% A) TRANSITIONAL INPUT TAX IS 2/ OF THE VALUE OF THE INVENTORY OR THE ACTUAL VAT PAID! WHICHEVER IS HIGHER B) AMOUNTS RECEIVED FROM SERVICES PERFORMED BY AN INDIVIDUAL PURSUANT TO AN EMPLOYER-EMPLOYEE RELATIONSHIP ARE EXEMPT FROM VAT C) EXPORT SALES BY VAT-REGISTERED PERSONS ARE NOT SUBJECT TO VAT D) EXPORT SALES BY PERSONS WHO ARE NOT VAT-REGISTERED ARE VAT EXEMPT 2#. TRANSACTION BY A VAT-REGISTERED TAXPAYER WHICH IS NOT SUBJECT TO VAT* A) B) C) D) FOREIGN CURRENCY DENOMINATED SALES EXPORT SALE TRANSACTION DEEMED SALE SALE OF SERVICES RENDERED IN FOREIGN COUNTRIES

2'. STATEMENT 1* THERE IS A VAT IN AN IMPORTATION BY AN IMPORTER-MERCHANT EVEN IF HE DOES NOT INTEND TO SELL THE IMPORTED ARTICLE STATEMENT 2* A PERSON WHO IS EXEMPT FROM VAT MAY REGISTER UNDER THE VAT SYSTEM A) B) C) D) FALSE! FALSE FALSE! TRUE TRUE! FALSE TRUE! TRUE

2(. STATEMENT 1* VAT IS IMPOSED ON GOODS BROUGHT INTO THE PHILIPPINES! WHETHER FOR USE IN BUSINESS OR NOT STATEMENT 2* IN THE CASE OF GOODS IMPORTED INTO THE PHILIPPINES BY A VAT EXEMPT PERSON WHICH ARE SUBSE"UENTLY SOLD TO TAXABLE PERSONS! THE LATTER SHALL BE CONSIDERED THE IMPORTER THEREOF AND SHALL BE LIABLE FOR VAT DUE ON SUCH IMPORTATION A) B) C) D) TRUE! TRUE FALSE! FALSE FALSE! TRUE TRUE! FALSE

2). CELEBRADO! A VAT REGISTERED TAXPAYER! HAD THE FOLLOWING DATA ON IMPORTATION IN 2++)* FOR SALE OWN USE INVOICE COST(21*PHP ') 2#!'#+ 2)#+ CUSTOMS DUTIES 12/ 1+/ FREIGHT 2+!+++ !+++ INSURANCE 2)!+++ !2#+ OTHER CHARGES BEFORE RELEASE FROM CUSTOMS HOUSE (!+++ 2!#++ FACILITATION FEE 1+!+++ #!+++ FREIGHT FROM CUSTOMS HOUSE TO WAREHOUSE(NET OF VAT) 12!+++ 1!2++ ASSUMING THE CUSTOMS DUTIES ARE DETERMINED ON THE BASIS OF THE "UANTITY OR VOLUME OF THE GOODS! THE VAT ON THE IMPORTATION IS A) 31!2'+ B) 3(!2)# C) (!,)1.(' D) !( 2 2,. IN RELATION TO NO. 2) ABOVE! HOW MUCH IS THE VAT PAYABLE IF THE IMPORTED GOODS FOR SALE WERE SOLD FOR P''#!+++ (INCLUSIVE OF TAX) 1+ DAYS AFTER ITS DELIVERY TO THE WAREHOUSE A) B) C) D) 2)!2(,. 32!2,) 1(!# + 2#!+')

3+. ROBIN IMPORTED A CAR FROM THE U.S.A. FOR HIS PERSONAL USE. TOTAL LANDED COST IS P2#+!+++ (ABOUT 2#!+++) INCLUDING CUSTOMS DUTIES OF P#+!+++. VAT PAYABLE IS A) 2#!+++ B) 3+!+++ C) 1+!+++ D).ERO! BECAUSE IMPORTATION IS FOR PERSONAL USE 31. RGF COMPANY IS A VAT REGISTERED GENERAL CONSTRUCTION COMPANY. ITS DATA FOR THE "UARTER ARE REVEALED BELOW* CONTRACT1-RESIDENTIAL HOUSE CONTRACT PRICE3P1!2++!+++ COLLECTIONS DURING THE MONTH CONTRACT2-WAREHOUSE CONTRACT PRICE3P1!+++!+++ PERCENTAGE OF COMPLETION COLLECTIONS DURING THE MONTH

'1'!+++

(+/ 22+!+)+

IMPORTATION OF CONSTRUCTION E"UIPMENT FROM JAPAN* INVOICE COST! JAPAN(21*PHP ) 2(!#++ VALUE PER BOC P3 +!+++ CUSTOMS DUTIES 3#!+++ FREIGHT AND INSURANCE 1(!+++ PURCHASES OF MATERIALS* FROM VAT REGISTERED PERSONS FROM NON-VAT REGISTERED PERSONS REVENUE FROM RENT OF E"UIPMENT TO ANOTHER CONTRACTOR 22'!2 + 12'!#++ 1(!,2+

ASSUMING THE CUSTOMS DUTIES WERE BASED ON THE "UANTITY OF THE GOODS IMPORTED! THE VAT DUE ON THE IMPORTATION IS A) B) C) D) '!)'+ #2!2'+ #!) + '!+#+

32. THE VAT PAYABLE BY RGF COMPANY DURING THE "UARTER IS A) B) C) D) 21! 2+ 1,!2++ '! #+ 2+! ++

33. BATA! A VAT REGISTERED PERSON HAD THE FOLLOWING DATA* PRICE ACTUALLY PAID FOR THE GOODS BOUGHT FROM JAPAN P'++!+++ RELATED INSURANCE AND FREIGHT FROM JAPAN 1++!+++ CUSTOMS DUTIES AMOUNT TO +/ OF DUTIABLE VALUE OTHER IMPORT CHARGES AND EXPENSES AMOUNT TO 12+/ OF CUSTOMS DUTIES THE VAT ON IMPORTATION IS A) B) C) D) )2!#'+ 1 #!,2+ 13#!3'+ 1#(!,2+

3 . PATOGRO$ COMPANY CONTRACTED WITH SAPOTI.E CONSTRUCTION CORPORATION TO CONSTRUCT THE FORMER&S BUILDING WHERE ONLY THE LABOR WILL BE SUPPLIED BY THE LATTER. THE DATA ON THE CONSTRUCTION (INCLUSIVE OF TAX) DURING THE MONTH ARE AS FOLLOWS* PROGRESS BILLINGS BY SAPOTI.E COMPANY PAYMENT TO SAPOTI.E COMPANY PURCHASE OF MAT&LS BY PATOGRO$ COMPANY WHICH OF THE FOLLOWING STATEMENTS IS FALSE% A) CONSTRUCTION IN PROGRESS IS NOT DEPRECIATED UNTIL THE ASSET IS PLACED IN SERVICE B) FOR PURPOSES OF CLAIMING INPUT TAX! AS A PURCHASE OF SERVICE! THE VALUE OF WHICH SHALL BE DETERMINED BASED ON THE PROGRESS BILLINGS C) THE INPUT TAX CREDIT ON THE LABOR CONTRACTED SHALL BE RECOGNI.ED ON THE MONTH THE PAYMENT WAS MADE BASED ON THE PROGRESS BILLINGS D) ONCE THE INPUT TAX HAS ALFREADY BEEN CLAIMED WHILE THE CONSTRUCTION IS STILL IN PROGRESS! NO ADDITIONAL INPUT TAX CAN BE CLAIMED UPON COMPLETION OF THE ASSET WHEN IT HAS '++!+++ #+ !+++ 2! ++

BEEN RECLASSIFIED AS A DEPRECIABLE CAPITAL ASSET AND DEPRECIATED 3#. AILEEN! A JAPANESE RESIDING IN THE PHILIPPINES BOUGHT GARMENTS FROM CUA CORPORATION! A DOMESTIC CORPORATION! AND EXPORTED THE SAME TO JAPAN. TOTAL VALUE OF EXPORT IS P1++!+++. VAT(OUTPUT TAX) DUE ON THE TRANSACTION IS A) B) C) D) 1+!+++ #!+++ NONE! BECAUSE +/ APPLIES NONE! BECAUSE THE SALE IS VAT-EXEMPT

3'.OFFSPRING CORPORATION IS A VAT REGISTERED DEALER OF APPLIANCES. THE FOLLOWING DATA ARE FOR THE MONTH OF OCTOBER* SALES! TOTAL INVOICE VALUE PURCHASES! NET OF INPUT TAXES SALES RETURN PURCHASES RETURN! NET OF INPUT TAX DEFERRED INPUT TAXES! (CARRIED OVER FROM THE THIRD "UARTER) #!)++!+++ 2!)2+!+++ 2++!+++ 3++!+++ ,!#++

THE VAT PAYABLE FOR THE MONTH OF OCTOBER BY OFFSPRING CORPORATION IS A) B) C) D) 32+!#++ 2)#!#++ )+!+++ 2))!1++

3'. THE FOLLOWING ARE THE DATA OF CITY APPLIANCES MAR$ETING COMPANY FOR OCTOBER 2++)* SALES UP TO OCTOBER 1#! TOTAL INVOICE VALUE PURCHASES UP TO OCTOBER 1#! NET OF INPUT TAXES ADDITIONAL INFORMATION* ON OCTOBER 1'! 2++)! THE CITY APPLIANCES MAR$ETING CO. RETIRED FROM ITS BUSINESS AND THE INVENTORY VALUED AT P1,+!+++! NET OF INPUT TAXES! WAS TA$EN AND TRANSFERRED TO NEW CITY APPLIANCES COMPANY. THERE IS A DEFERRED INPUT TAXES FROM THE THIRD "UARTER OF P3!#++. 2''!+++ 21#!+++

HOW MUCH IS THE TOTAL VAT DUE AND PAYABLE BY CITY APPLIANCES MAR$ETING CO. IN ITS OPERATIONS IN OCTOBER AND ITS RETIREMENT FROM THE BUSINESS% A) B) C) D) 22!#++ 22!+++ '!3#+ 2#!3#+

NUMBERS !# AND !8 ARE BASED ON THE FOLLOWING INFORMATION* GABRIEL PANGA AUTO REPAIR SHOP! VAT REGISTERED! HAD THE FOLLOWING DATA IN ITS BOO$S DURING THE PERIOD* RECEIPTS* FROM AUTO REPAIR )#!'2+ FROM WASHING AND GREASING #! 2# REIMBURSEMENT BY CUSTOMER ON PAYMENTS MADE TO VAT MACHINE SHOPS !3#+ PAYMENTS RECEIVED FOR LUBRICANTS! OILS AND FLUID PROVIDED BY THE SHOP TO CARS UNDERGOING REPAIR #!()+ DISBURSEMENTS* ELECTRIC BILL WATER BILL SALARIES OF EMPLOYEES PAYMENTS MADE TO MACHINE SHOPS! NON-VAT PURCHASE OF LUBRICANTS! OILS AND FLUIDS PURCHASE OF CAPITAL GOODS(LIFE31+YRS) 3(. THE OUTPUT TAX AMOUNT TO A) B) C) D) 1'! 1, 1'!, 1 1 !''+ 1#!12' 3!##+ 2!3)+ 1#!+++ !3#+ 3!+++ 2 !+++

3). IN RELATION TO NO. 3( ABOVE! THE VAT PAYABLE IS A) B) C) D) ,! + 12!(#3 ,! #, '!,(,

3,. TAXPAYERS WHO BECAME VAT REGISTERED PERSONS UPON EXCEEDING THE MINIMUM TURN-OVER OF P1.# MILLION IN ANY 12MONTH PERIOD! OR WHO VOLUNTARILY REGISTER EVEN IF THEIR TURNOVER DOES NOT EXCEED P1.# MILLION SHALL BE ENTITLED TO TRANSITIONAL INPUT TAX ON THE INVENTORY ON HAND AS OF THE EFFECTIVITY OF THEIR VAT REGISTRATION ON THE FOLLOWING! EXCEPT* A) SUPPLIES FOR USE IN THE COURSE OF TAXPAYER&S TRADE OR BUSINESS B) GOODS WHICH HAVE BEEN MANUFACTURED BY THE TAXPAYER C) GOODS IN PROCESS FOR SALE D) CAPITAL GOODS BEING USED IN THE OPERATION OF THE BUSINESS NUMBERS $0 TO $! ARE BASED ON THE FOLLOWING INFORMATION: SUMILCO! A MANUFACTURER OF REFINED SUGAR! BECAME SUBJECT TO VAT EFFECTIVE DECEMBER 1! 2++). DURING THE MONTH! THE FOLLOWING ARE ITS DATA* REFINED SUGAR WITHDRAWN FROM REFINERY! INCLUSIVE OF VAT PURCHASES OF* SUPPLIES FROM VAT REGISTERED SUPPLIERS PAC$AGING MATERIALS! VAT INCLUSIVE SUGAR CANE FROM PLANTERS WATER BILL SALARIES OF OFFICIALS AND EMPLOYEES INVENTORY PER BALANCE SHEET! DECEMBER 1 !2++) PAC$AGING MATERIALS SUPPLIES PURCHASED FROM VAT REGISTERED PERSONS SUPPLIES PURCHASEDFROM NON-VAT REGISTERED SUPPLIERS +. THE PRESUMPTIVE INPUT TAX IS A) B) C) D) 3#!+++ #!2#+ 13!)'+ 1 !+++ ,2 !+++ 3)!#++ 2(!+'+ 3#+!+++ 12!+++ 1#+!+++ 1(!)(# 1 !)#+ !(#+

1. THE TRANSITIONAL INPUT TAX IS A) B) C) D) 3!#+'.2# 2!,(# '# .#+ 2!,,)

2. THE TOTAL CREDITABLE INPUT TAX IS A) B) C) D) 2 !#3+.# 13!)2) ,2!,3# 22!,3#

3. THE VAT PAYABLE IS A) B) C) D) '1!+'# (+!1(2 ( ! ',. ' ',!)1#

. AN IMPORTER WISHES TO WITHDRAW ITS IMPORTATION FROM BOC. THE IMPORTED GOODS WERE SUBJECTED TO A 1+/ CUSTOMS DUTY IN THE AMOUNT OF P12!#++ AND TO OTHER CHARGES IN THE AMOUNT OF P,!#++. THE VAT DUE IS A) B) C) D) 12!#++ 1(!' + 13!3' 1 !(++

#. $A$A IS NA CONTRACTOR. SHE ENTERED INTO A CONTRACT ON MARCH 1! 2++) WHICH WAS COMPLETED ON MARCH 31! 2++). SHE RECEIVED THE TOTAL VALUE OF THE CONTRACT AMOUNTING TO P##+!+++ ON MARCH 31! 2++). $A$A SPENT FOR THE MATERIALS USED IN THE CONTRACT WHICH SHE AC"UIRED FROM VALUE-ADDED REGISTERED SUPPLIERS COSTING P1#+!+++. ALL AMOUNTS ARE EXCLUSIVE OF VAT. THE VAT PAYABLE BY $A$A FOR THE MONTH OF MARCH IS A) B) C) D) 1#!+++ +!+++ )!+++ #,!#++

'. ARCHIE LADO! A NEWLY VAT REGISTERED TAXPAYER IS A LESSOR OF POLES TO TELEPHONE AND CABLE COMPANIES. DURING THE MONTH OF JANUARY 2++)! HE HAD THE FOLLOWING RECEIPTS FROM CUSTOMERS* SECURITY DEPOSIT FROM CUSTOMER C RENT INCOME IN JANUARY FROM VARIOUS CUSTOMERS PREPAID RENTALS RECEIVED FROM CUSTOMER C (FEBRUARY TO JUNE) LOAN TO ARCHIE LADO FROM CUSTOMER B 11+!+++ ))!+++ 132!+++ )2!#++

DURING THE MONTH! A PORTION OF THE SECURITY DEPOSIT FOR THE FAITHFUL COMPLIANCE BY CUSTOMER C OF ITS OBLIGATIONS TO THE LESSOR WAS APPLIED TO RENTAL FOR JANUARY IN THE AMOUNT OF P11!+++. AT THE BEGINNING OF THE YEAR! ARCHIE HAD P2#2!+++ WORTH OF INVENTORY OF SUPPLIES AND MATERIALS FOR USE IN THE BUSINESS. VAT PAID ON THE BEGINNING INVENTORY IS P3!#++. THE OUTPUT TAX OF ARCHIE IN JANUARY IS A) B) C) D) 2 !(#+ 21!+++ 2)!#++ 3,!#++

(. IN "UESTION NO. ' ABOVE! THE INPUT TAX ON ARCHIE IS A) B) C) D) #!+ + .ERO 21!+++ !1'+

). IN WHICH OF THE FOLLOWING CASES MAY REFUND OF INPUT TAX BE ALLOWED% 1ST CASE*FOR INPUT TAX ON PURCHASES OF CAPITAL GOODS 2ND CASE* FOR INPUT TAX ON PURCHASES OF GOODS AND SERVICES BY AN EXPORTER A) B) C) D) IN BOTH CASES ONLY IN THE 1ST CASE NEITHER IN THE 1ST NOR IN THE 2ND CASE ONLY IN THE 2ND CASE

,. MARINDA IS A VAT REGISTERED GROCERY OWNER AND SUGAR DEALER. SHE SUBMITTED LISTS OF INVENTORY AS OF DECEMBER 31! 2++( TO THE RDO AS FOLLOWS* GROCERY ITEMS! TOTAL VALUE RAW CANE SUGAR! TOTAL VALUE 32#!+++ 2##!+++

IN JANUARY 2++)! SHE HAD THE FOLLOWING SALES AND PURCHASES* SALES PURCHASES GROCERY(TOTAL INVOICE VALUE) 1!+ 2!#2# '#+!1++ SUGAR(EXCLUDING VAT) )+!+++ 2+!+++ THE VAT DUE FOR JANUARY 2++) IS A) B) C) D) 3#!'(# 2!+# .# 1!'(#.31 '!'(#.2'

NUMBERS "0 AND "1 ARE BASED ON THE FOLLOWING INFORMATION: GOODBOO$S EDUCATIONAL SUPPLY! VAT REGISTERED! IS ENGAGED IN THE BUSINESS OF SELLING BOO$S! SCHOOL SUPPLIES AND GIFT ITEMS. THE FOLLOWING ARE THE RECORD OF ITS PURCHASES AND SALES DURING THE MONTH OF OCTOBER(INCLUSIVE OF TAX)* SALE OF SCHOOL SUPPLIES SALE OF BOO$S SALE OF GIFT ITEMS PURCHASES OF SCHOOL SUPPLIES0GIFT ITEMS PURCHASES OF BOO$S PURCHASE OF COMPUTER USED I N TAXABLE AND EXEMPT TRANSACTIONS #'+!+++ 2++!+++ 33#!+++ +'!+++ 1('!+++ 21!112

#+. THE CREDITABLE INPUT TAX ON THE PURCHASE OF COMPUTER IS A) B) C) D) 2! ++.2+ 1!,2+.#+ 2'! ++.'# 1!)+,.'+

#1. IN RELATION TO NO. #+ ABOVE! THE VAT PAYABLE IS A) B) C) D) #+!',+. + 3 !1++.#+ 3'!#++ 3!2)+.2#

#2. TALA COMPANY HAD THE FOLLOWING DATA FOR THE 1ST "UARTER OF 2++)(VAT EXCLUSIVE)* TAXABLE SALES EXEMPTED SALES .ERO-RATED SALES INPUT TAX WHICH CANNOT BE DIRECTLY ATTRIBUTED TO ANY OF THE ABOVE SALES THE VAT PAYABLE FOR THE "UARTER IS A) B) C) D) 2!+++ 3(!+++ 32!+++ 22!+++ '++!+++ 3++!+++ 1++!+++ #+!+++

#3. COMBINED COMPANY OPERATES A VAT BUSINESS AND A NON-VAT BUSINESS. DURING THE MONTH! ITS BOO$S REVEALED THE FOLLOWING RECORD OF SALES AND PURCHASES* SALES(VAT BUSINESS) SALES (NON-VAT BUSINESS) PURCHASES(VAT BUSINESS) PURCHASES(NON-VAT BUSINESS) PURCHASES (VAT AND NON-VAT BUSINESSES) '++!+++ 2++!+++ +1!#++ )+!+++ ' !+++

THE VAT PAYABLE BY COMBINED COMPANY IS A) B) C) D) (!''+ '!+'+ 13!#++ 1)!+'+

# . EXCEL COMPANY!OPERATES TWO LINES OF BUSINESS. BUSINESS A IS SUBJECT TO VAT! WHILE BUSINESS B IS NOT. DATA FOR THE MONTH ARE AS FOLLOWS* SALES* VAT BUSINESS! VAT INCLUDED #'+!+++ NON-VAT BUSINESS 1++!+++ PURCHASES* MERCHANDISE! VAT BUSINESS! VAT INCLUDED 1# !+++ MERCHANDISE! NON-VAT BUSINESS! VAT INCLUDED '(!1++ CAPITAL GOODS! VAT BUSINESS! VAT INCLUDED 3 !((' CAPITAL GOODS! NON VAT BUSINESS! VAT INCLUDED 2(!#++ CAPITAL GOODS! FOR USE IN BOTH BUSINESSES! VAT INCLUDED #'!+++ RENT OF STORE SPACE! VAT BUSINESS! VAT INCLUDED RENT OF WAREHOUSE! VAT AND NON-VAT BUSINESS! VAT EXCLUDED FREIGHT OF GOODS! VAT AND NON-VAT BUSINESS! VAT INCLUDED TELEPHONE BILLS! VAT AND NON-VAT! VAT INCLUDED THE INPUT TAX ON BUSINESS A IS* A) B) C) D) 2(!()1 23!( ( 23!2'( 1)!)(# 1 !#'+ '!2++ 2!#(' 1!'2

##. IN "UESTION NO. # ABOVE! THE VAT PAYABLE BY EXCEL COMPANY IS A) B) C) D) 1,!+3# 2+!(33 2+!2#3 32!21,

NUMBERS "% THROUGH "8 ARE BASED ON THE FOLLOWING INFORMATION: MILDRED ENTERPRISES! A VAT REGISTERED TRADER HAD THE FOLLOWING DATA DURING THE LAST "UARTER OF THE YEAR* PURCHASES SALES OCTOBER '2(!2++ 3,2!+++ NOVEMBER #,,!2++ )'2! ++ DECEMBER ,#,!'1' (),!'++

#'. THE AMOUNT OF VAT PAYABLE BY MILDRED FOR THE MONTH OF OCTOBER IS A) B) C) D) 2#!2++ 1'!#++ 2!+++ .ERO

#(. THE VAT PAYABLE FOR THE MONTH OF NOVEMBER IS A) B) C) D) 2+3!#++ 2)!2++ 3!+++ .ERO

#). THE VAT PAYABLE0EXCESS FOR THE LAST "UARTER IS A) B) C) D) (1)!21') 1)!21' '+!,++ .ERO

NUMBERS "& THROUGH %1 ARE BASED ON THE FOLLOWING INFORMATION: THE BOO$S OF ACCOUNTS OF FRAN$LIN CORPORATION! VAT REGISTERED! REVEALED THE FOLLOWING DATA IN 2++(* DEFERRED INPUT TAXES! JUNE 2++( SALES* JULY AUGUST SEPTEMBER PURCHASES* JULY AUGUST SEPTEMBER #,. THE VAT PAYABLE FOR JULY IS A) B) C) D) 13! + (!2 + 11!2++ #!+++ '!2++ '2+!+++ 3+!+++ # +!+++ #+)!+++ 32!+++ 31 !#++

'+. THE VAT PAYABLE FOR AUGUST IS A) B) C) D) ('! +) (2 +) .ERO (!+++

'1. THE VAT PAYABLE FOR SEPTEMBER IS A) B) C) D) 2'!#)+ 2(!+'+ 2+!)'+ 3 !+,+ CASE 2 1!)++!+++ 1!'++!+++ ,++!+++ 3 YEARS

'2. FELICISIMA HAD THE FOLLOWING DATA* CASE 1 SALES! NET OF VAT 1!,++!+++ PURCHASES OF GOODS FOR SALE! EXCLUSIVE OF VAT 1!2'+!+++ PURCHASES OF MACHINES(VAT NOT INCLUDED) 1! +!+++ MACHINE LIFE ' YEARS

THE AMOUNTS OF VAT PAYABLE0EXCESS TAX ARE AS FOLLOWS* A) B) C) D) CASE 1 # !+++ (3!,2+ (3!,2+ .ERO CASE 2 () !+++) () !+++) 2+!+++ .ERO '3. LAVINIA HAD THE FOLLOWING DATA IN JULY* SALES OF GOODS(EXCLUDING VAT) PURCHASES OF GOODS(NET OF VAT) PURCHASES OF CAPITAL GOODS(INVOICE AMOUNT)* MACHINE 1 (USEFUL LIFE)3' YEARS MACHINE 2 (USEFUL LIFE)33 YEARS THE VAT PAYABLE IN JULY IS A) B) C) D) 12+!)'+ 1,!2++ 33!'++ ( +!)++) 2!# +!+++ 1! #+!+++ ,( ! ++ '(!2++

NUMBERS %$ AND %" ARE BASED ON THE FOLLOWING INFORMATION: THE FOLLOWING DATA (NET OF TAX) OF CHRISTINE COMPANY ARE AS FOLLOWS* 1ST "UARTER* SALES PURCHASES PURCHASE OF MACHINERY(FEBRUARY) UNUTILI.ED INPUT TAX AS END OF 1ST "TR 2ND "UARTER SALES PURCHASES 1!#++!+++ 2++!+++ (++!+++ #++!+++ 1!#++!+++ +!+++

' . FOR THE FIRST "UARTER! CHRISTINE COMPANY WILL RESULT TO A0AN A) B) C) D) VAT PAYABLE OF (2!+++ EXCESS TAX OF 22!+++ EXCESS TAX OF 1,'!+++ VAT PAYABLE OF 22!+++

'#. THE VAT PAYABLE FOR THE SECOND "UARTER IS A) B) C) D) 1#'!+++ 13 !+++ 12#!+++ .ERO

''. DATA DURING THE SECOND "UARTER* OUTPUT TAX 3#!+++ INPUT TAX 1,!+++ VAT PAID* APRIL 3!+++ MAY !#++ ST EXCESS INPUT TAX! 1 "UARTER 2! ++ THE VAT PAYABLE (OR EXCESS TAX TO BE CARRIED OVER) IS A) B) C) D) '!1++ 1'!+++ )!#++ .ERO

'(. A NEW BUSINESSMAN CONSULTED YOU RELATIVE TO THE FILING OF TAX RETURN AND PAYMENT OF HIS BUSINESS TAX. THE BUSINESS IS VAT REGISTERED ALTHOUGH HE IS EXPECTING TO EARN AN ADDITIONAL GROSS RECEIPTS RANGING FROM P,++!+++ TO P1!2++!+++ ONLY. THESE ARE HIS "UESTIONS* 1. WHAT BUSINESS TAX SHOULD BE PAID BY HIM% 2. WHEN IS THE DEADLINE FOR FILING THE TAX RETURN FOR THE MONTH OF MAY% 3. WHEN IS THE DEADLINE FOR THE PAYMENT OF THE BUSINESS TAX FOR THE MONTH OF JUNE(OR SECOND "UARTER)% WHICH OF THE FOLLOWING CHOICES WOULD BE THE CORRECT ANSWER% A) B) C) D) "UESTION 11 VAT VAT NON-VAT NON-VAT "UESTION 12 JUNE 2+ JUNE 2# JUNE 2+ JUNE 2+ "UESTION 13 JULY 2# JULY 2# JULY 2# JULY 2#

NUMBERS %8 AND %& ARE BASED ON THE FOLLOWING INFORMATION* THE CITY GOVERNMENT OF IRIGA HAS THE FOLLOWING PURCHASES FOR THE MONTH OF AUGUST 2++, FROM VAT SUPPLIERS OF GOODS AND0OR SERVICES* PURCHASES OF GOODS FROM SINADIRI STORE AND MERCHANDISE (INCLUSIVE OF VAT) PURCHASE OF SERVICES FROM DAMAN SERVICES! INC. 11!2++ #'!+++

'). THE AMOUNT PAYABLE TO SINADIRI STORE AND MERCHADISE AFTER WITHHOLDING TAXES OF VAT AND INCOME TAX IS A) B) C) D) 11!2++ 1+!'++ ,! ++ 1+!#++

',. THE AMOUNT PAYABLE TO DAMAN SERVICES! INC. AFTER WITHHOLDING TAXES OF VAT AND INCOME TAX IS A) #'!+++ B) #+!+++ C) #2!#++ D) #3!#++

C. TRUE OR FALSE 1 VAT REGISTERED PERSON WHO ISSUES A VAT INVOICE FOR A VAT EXEMPT SALE BUT FAILS TO DISPLAY ON THE INVOICE THE TERM 4VAT EXEMPT5 SHALL BE SUBJECT TO VAT ON THAT SALE 2. THE INPUT TAX OF A VAT PURCHASER IS THE OUTPUT TAX OF THE VAT SELLER. 3.SERVICES RENDERED TO PERSONS ENGAGED IN INTERNATIONAL SHIPPING OR AIR TRANSPORT OPERATIONS ARE SUBJECT TO 12/ VAT. .THE EXCESS OF OUTPUT VAT OVER THE INPUT TAX IS A CURRENT ASSET OF THE TAXPAYER #.THE INPUT VAT ON PURCHASE OF CAPITAL GOODS VALUED AT P2!+++!+++ SHALL BE SPREAD OVER '+ MONTHS! OR THE LIFE OF THE ASSET! WHICHEVER IS SHORTER! SUBJECT TO (+/ VAT CAP '. PERSONS ENGAGED IN SALE OF SERVICES MAY ALSO BE ALLOWED TO CLAIM TAX CREDIT ON PRESUMPTIVE INPUT TAX (. GROSS RECEIPTS ON SERVICES RENDERED BY ALL FRANCHISE GRANTEES ARE SUBJECT TO FRANCHISE TAX ). TRANSPORTATION CONTRAC TORS WHO TRANSPORT PASSENGERS FOR HIRE BY LAND ARE NOT SUBJECT TO VAT EVEN IF THEIR GROSS RECEIPTS IN A 12-MONTH PERIOD DO NOT EXCEED P1!#++!+++ ,.A CPA IS SUBJECT TO VAT ON THE SALE OF PROFESIONAL SERVICES UNLESS THE GROSS RECEIPTS IN A 12-MONTH PERIOD DO NOT EXCEED P1!#++!+++ 1+. A PHYSICIAN IS NOT SUBJECT TO VAT BECAUSE IN EXERCISING HIS PROFESSIONAL SERVICES HE IS NOT ENGAGING HIMSELF IN BUSINESS 11. THERE IS NO CREDITABLE INPUT TAX ON SALES TO GOVERNMENT OR ANY OF ITS POLITICAL SUBDIVISIONS! INSTRUMENTALITIES OR AGENCIES! INCLUDING GOCC6 12. IF THE INVOICE PRICE IS INCLUSIVE OF VAT! THE AMOUNT GIVEN IS MULTIPLIED BY 120112 TO GET THE VAT COMPONENT THEREON

13.A TAXPAYER WHO OPERATES A VAT AND A NON-VAT BUSINESS CANNOT CLAIM INPUT TAX CREDIT ON PURCHASES OF GOODS TO BE USED IN HIS NON-VAT BUSIN ESS 1 .ANY INPUT TAX ATTRIBUTABLE TO .ERO-RATED SALES BY A VATREGISTERED PERSON MAY AT HIS OPTION BE REFUNDED OR APPLIED FOR A TAX CREDIT CERTIFICATE WHICH MAY BE USED IN THE PAYMENT OF INTERNAL REVENUE TAXES 1#.BAN$S AND OTHER BAN$ING INSTITUTIONS ARE SUBJECT TO VAT 1'.IMPORTATION OF GOODS ARE SUBJECT TO VAT EVEN IF THE INTENTION OF THE IMPORTER IS TO USE THE IMPORTED GOODS FOR PERSONAL PURPOSES 1(.THE GROSS RECEIPTS DERIVED FROM EXECISE OF A PROFESSION AND FROM OTHER LINES OF VATABLE BUSINESS SHALL BE COMBINED FOR PURPOSES OF DETERMINING THE THRESHOLD OF P1!#++!+++ 1).THE ACCOUNT OUTPUT TAX MUST APPEAR IN THE CURRENT LIABILITY SECTION OF THE BALANCE SHEET. 1,.A LEASE OF A COPYRIGHT ON TAXATION BOO$S ARE SUBJECT TO VAT 2+. INPUT TAX! BEING A TAX! IS AN EXPENSE ON THE PART OF THE PURCHASER AND IS DEDUCTIBLE FROM GROSS INCOME FOR PURPOSES OF COMPUTING THE NET INCOME 21.VAT IS A REGRESSIVE TAX 22. SYSTEMS LOSS ON ELECTRICITY THAT ARE BEING CHARGED BY ELECTRIC COOPERATIVES TO CONSUMERS ARE SUBJECT TO 12/ VAT 23. PRINTING OF INVOICES AND RECEIPTS (INCLUDING DELIVERY RECEIPTS) RE"UIRES APPROVAL FROM BIR 2 .PURCHASES AND SALES ARE RECORDED IN THE BOO$S OF A NON-VAT TAXPAYER AT AN AMOUNT WHICH IS NET OF INPUT0OUTPUT TAXES 2#. A SALE OF POWER OR FUEL WHICH IS G ENERATED FROM SOLID WASTE IS SUBJECT TO +/ VAT