TEST 1 – DONOR’S TAX THEORY

1. C 21. C 41. A 61. D

2. B 22. D 42. D 62. D
3. C 23. C 43. C 63. C
4. B 24. D 44. D 64. C
5. A 25. A 45. A 65. B
6. A 26. C 46. D 66. C
7. A 27. D 47. C 67. C
8. C 28. B 48. D 68. C
9. D 29. C 49. C 69. C
10. C 30. D 50. C 70. C

11. B 31. D 51. B 71. B

12. A 32. D 52. A 72. D
13. A 33. C 53. C 73. D
14. B 34. C 54. D 74. C
15. A 35. A 55. B 75. A
16. D 36. B 56. C 76. C
17. A 37. D 57. D 77. D
18. B 38. C 58. C 78. A
19. D 39. C 59. C 79. A
20. B 40. B 60. B 80. D
81. D
82. C

Answer: D
32.

53
 Capital property P100,000
Community property (500,000/2) 250,000
Gross gift 350,000

Answer: C
33
.
Paraphernal property P300,000
Community property (500,000/2) 250,000
Gross gift 550,000

Answer: C
34
.

Answer: A (see Solution in Question No. 5)

35
.

Answer: B
36
.
To Ara 120,000
Alice 75,00
0
Aiko 250,00
0
Assunta 200,00
0
Naga City 125,00
0
Gross gift 770,000
Less: Exemptions/Deductions
On Ara 10,000
Assunta (75,000 x 50%) 37,500
Naga City 125,000 172,50
0
Net gift 597,50
0

38 Answer: A
Market value at the time of sale P
450,000
Less: Selling price 250,000
Deemed gift 200,000

On P200,000 2,000

39 Answer: C
.

40 Answer: B
.
Gross gift P 500,000
Less: Exemption - .

54
 Net gift 500,000
Rate of tax (stranger) 30%
Gift tax due 150,000

41 Answer: A
.

Gross gift P 700,000

Less: Exemption _______
Net gift 700,000
Rate (stranger) 30%
Gift tax 210,000
42 Answer: D
.

Gross gift (brother) P 40,000

Less: Exemption - .
Net gift 40,000

On P40,000 Exempt

Jewelries P 25,000
Rate of tax (stranger) 30%
Gift tax 7,500

43 Answer: C
.

Market value P 250,000

Less: Selling price 100,000
Deemed gift 150,000
Rate of tax 30%
Gift tax due 45,000

44 Answer: D
.

45 Answer: A
.
Donation to first cousin:
Gross gift P200,00
0
Less: Exemptions - .
Net gift 200,00
0

Tax on P200,000 P 2,000

Donation to fiancee of first cousin:

Net gift P
50,000
Rate (stranger) 30%
Gift tax 15,00
0
Tax on donation to first cousin 2,000

55
 Tax on donation to fiancee 15,00
0
Donor's tax due 17,00
0

50 Answer: C
.
Gross gift (P100,000 x 2) P
200,000
Less: Exemption _______
Net gift 200,000

On P200,000 2,000

51 Answer: B
.
Gross gift P
100,000
Less: Exemption 10,000
Net gift 90,000
Add: Net gift, August 15 200,000
Total net gifts 290,000

On P 200,000 P 2,000
90,000 x 4% 3,600
Gift tax due 5,600
Less: Tax paid, August 15 2,000
Gift tax due 3,600

52 Answer: A
.

Gross gift P
185,000
Less: Exemption - .
Net gift 185,000
Rate (stranger) 30%
Gift tax 55,500

53 Answer: C
.
Gross gift P
170,000
Less: Exemption _______
Net gift 170,000
On P 100,000 Exempt
70,000 x 2% P 1,400

54 Answer: D
.
Gross gift P
30,000
Less: Exemption - .
Net gift 30,000
Add: Net gift, July 15 170,000

56
 Total net gift 200,000

On P 200,000 P 2,000
Less: Tax paid, July 15 1,400
Gift tax due 600

55 Answer: B
.
Mr. Cruz Mrs.
Cruz
Value of property (380,000/2) P 190,000 P 190,000
No. of donees 3 3
Gross gift 570,000 570,000
Less: Exemptions - . - .
Net gift 570,000 570,000

Tax on P 500,000 P 14,000 P 14,000

70,000 x 6% 4,200 4,200
Gift tax due 18,200 18,200

56 Answer: C (see the solution in No. 13

. above)

57 Answer: D
.
Gross gift (P300,000/2) P150,000 P150,000
Less: Exemptions 10,000 10,000
Net gift 140,000 140,000
Add; Net gift, July 16, 2008 570,000 570,000
Total 710,000 710,000

Tax on P 500,000 14,000 14,000

210,000 x 6% 12,600 12,600
Tax on total 26,600 26,600
Less: Tax paid, July 16, 2008 18,200 18,200
Gift tax due 8,400 8,400
Total donor's tax due (8,400 + 8,400) 16,800

58 Answer: C
.
Amount of exemption allowed by law P 10,000
Less: Exemption claimed on January 30 7,500
Allowed exemption on March 7 2,500

59 Answer: C
.
Gross gift P 80,000
Less: Exemptions - .
Net gift 80,000

57
 Add: Net gift, March 7 (25,000 - 2,500) 22,500
Total 102,500

Tax on P100,000 Exempt

2,500 x 2% P 50

60 Answer: B
.
Gross gift P
100,000
Less: Exemption - .
Net gift 100,000
Add: Net gift, July 15 (P 50,000 – 1,000) 49,000
Total net gift 149,000

Tax on P 100,000 Exempt

49,000 x 2% P 980

61 Answer: D
.
To Suwail P
125,000
City of Baguio 200,000
Sumakwel 125,000
Ysmael 150,000
Gross gift 600,000
Less: Exemptions
To Suwail P
10,000
City of Baguio 200,000 210,000
Net gift 390,000

On P 200,000 P 2,000
190,000 x 4% 7,600
Gift tax 9,600

62 Answer: D
.
Gross gift P150,00
0
Less: Exemptions 10,00
0
Net gift 140,00
0

Tax on P 100,000 Exempt

40,000 x 2% P 800

63 Answer: C
.
Net gift P
175,000
Add: Net gift, Jan. 5, 2008 140,00
0
Total net gifts 315,00
0

58
 Tax on P 200,000 P 2,000
115,000 x 4% 4,600
Tax on total 6,600
Less: Tax paid, 1/6 800
Gift tax due 5,800

64 Answer: C
.
Gross conjugal (P500,000/2) P250,00
0
Less: Exemptions 10,00
0
Net gift 240,00
0
Add: Prior net gifts
Net gift, Jan. 5 P140,00
0
April 6 175,00 315,00
0 0
Total 555,00
0

Tax on P500,000 P 14,000

55,000 x 6% 3,300
Tax on total 17,300
Less: Taxes previously paid
Jan. 5 P
800
April 6 6,600
5,800
Gift tax due 10,700

65 Answer: B
.
Gross gift P200,00
0
Less: Exemptions - .
Net gift 200,00
0
Add: Net gift, May 7 (250,000 - 240,00
10,000) 0
Total 440,00
0

Tax on P 200,000 P 2,000

240,000 x 4% 9,600
Tax on total 11,600
Less: Tax paid, May 7
P 200,000 P
2,000
40,000 x 4% 1,600 3,600

59
 Gift tax due 8,000

66 Answer: C
.
To Panganay (200,000/2) x ½ P
50,000
Bunso (200,000/2) 100,00
0
Gross gift 150,00
0
Less: Exemptions
To Panganay P10,000
Bunso 10,000 20,00
0
Net gift 130,00
0

Tax on P100,000 Exempt

30,000 x 2% P 600

To Panganay’s wife (200,000/2) x 1/2 P 50,000

Rate (stranger) 30%
Gift tax 15,000
Gift tax on Panganay and Bunso P 600
Gift tax on Panganay’s wife 15,000
Donor’s (gift) tax payable 15,600

67 Answer: C (see Solution in Question No. 9)

.

68 Answer: C
.
To Nevada P
710,000
Less: Exemptions 10,00
0
Net gift 700,00
0

Tax on P 500,000 P14,000

200,000 x 6% 12,000
Gift tax on Nevada 26,000

To Navera P
120,000
Less: Deductions 20,00
0
Net gift 100,00
0
Rate of tax (stranger) 30%
Gift tax on Navera 30,00
0

Tax on Nevada P
26,000

60
 Tax on Navera 30,00
0
Total 56,00
0
Less: Tax credit
U.S. tax paid P15,000
Limit (700/800 x 56,000) 49,000
Allowed (lower) 15,00
0
Gift tax due after tax credit 41,00
0

69 Answer: C
.
Gross gift P150,00
0
Less: Exemptions - .
Net gift 150,00
0
Tax on P100,000 Exempt
50,000 x 2% P 1,000

70 Answer: C
.
Cash gift (P 50,000 x 3) P 150,000
Rate (strangers) 30%
Gift tax 45,00
0

71 Answer: B
.
Gross gift P
120,000
Less: Exemptions 10,00
0
Net gift 110,00
0

Tax on P 100,000 Exempt

10,000 x 2% P 200

72 Answer: D
.
Gross gift P
60,000
Less: Exemption 10,000
Net gift 50,000

Tax on P50,000 Exempt

73 Answer: D
.
Gross gift P
60,000
Less: Exemption 10,000

61
 Net gift 50,000
Add: Net gift, 1st quarter 50,000
Total net gift 100,000
Tax on P100,000 Exempt

74 Answer: C
.
Gross gift P
60,000
Less: Exemption 10,000
Net gift 50,000
Add: Prior net gifts
1st quarter P 50,000
2nd quarter 50,000 100,000
Total net gift 150,000
Tax on P100,000 Exempt
50,000 x 2% P 1,000

75 Answer: A
.
Net gift, Philippines 400,00
0
Net gift, Hongkong ($120,000 x 5) 600,0
00
Total net gift 1,000,000

Tax on P1,000,000 P44,000

Less: Tax credit
Tax paid, Hongkong ($12,500 x 5)
P62,500
Limit (6/10 x 44,000)
26,400
Credit allowed (lower) 26,400
Gift tax due after tax credit 17,600

76 Answer: C
.
Net gift, Philippines P200,00
0
Net gift, United States 150,000
Net gift, Japan 50,000 200,000
Total net gift 400,000
Tax on P200,000 2,00
0
200,000 x 4% 8,00
0
Gift tax 10,00
0
Less: Tax credit
Tax paid in U.S. 4,000
Limit (15/40 x 10,000) 3,750
Allowed (lower) P
3,750
Tax paid in Japan 3,500

62
 Limit (5/40 x 10,000) 1,250
Allowed (lower)
1,250
Total credits, 1st limitation
5,000
2nd limitation (20/40 x 10,000)
5,000
Allowed (lower) 5,00
0
Gift tax due after tax credit 5,00
0

63