CAVITE STATE UNIVERSITY

Imus Campus
Cavite Civic CenterPalico IV, Imus, Cavite
 (046) 471-66-07 / (046) 471-67-70 / (046) 686-23-4
MIDTERM EXAMINATION INCOME AND BUSINESS TAXATION
2nd SEMESTER SY 2017-2018

NAME: __________________________ DATE: _______________

YEAR & SECTION: _______________ SCORE: ______________

I. CHOOSE THE CORRECT LETTERS FOR THE STATEMENTS BELOW. STRICTLY NO

ERASURES! (10pts)
1. Which of the following is a form of business?
a. Trading
b. Manufacturing
c. Service business
d. All of the above
2. Which of the following is not a merchandising business?
a. Grocery store
b. Department store
c. Distributor
d. Accounting firm
3. Which of the following is considered as engaged in servicing business
a. EGV accounting firm
b. GFROX manufacturing
c. EDVAL supermarket
d. VALROX CAR dealer
4. Which of the following are BIR compliance requirements for those are engaged in business?
a. Registration with Revenue District Office
b. Keeping of accounting records
c. Issuance of invoices and receipts
d. All of the above
5. Which of the following is not correct regarding the Taxpayer’s Identification Number?
a. Only one TIN is allowed for each taxpayer
b. The TIN is issued every year every time the taxpayer is renewing his registration
c. The TIN is required to be indicated in every taxpayers tax return
d. Failure to indicate correct TIN on documents specified to be indicated with TIN shall be subject to applicable criminal sanctions
6. Which of the following taxes describes a value-added tax?
a. Income tax
b. Sales tax
c. Indirect tax
d. Personal tax
7. The annual registration fee for a VAT-registered business is
a. P 50
b. P 500
c. P 1,500
d. P 5,000
8. A business tax is generally
a. Direct tax
b. Indirect tax
c. Property tax
d. None of the above
9. The books of accounts must be kept in
a. Any language depending on the preference of the taxpayer
b. English language only
c. Native language or English only
d. Native language, English or Spanish
10. Implementation date of the TRAIN law
a. December 19, 2017
b. January 1, 2018
c. December 11, 2017
d. December 31, 2018

II. TRUE OR FALSE (10pts)

1. Sale of drugs for diabetes, high cholesterol, and hypertension will be VAT- free starting 2019.TRUE
2. Socialized and mass housing projects P2million an d below will be VAT-free starting 2020. FALSE
3. Increase of non-hybrid cars over 600,000 to 1million is 5%. FALSE
4. A 5% tax will be imposed on cosmetics surgery or medical procedures for purely aesthetic purposes.TRUE
5. A single tax rate of 5% based on the net value of the estate with a standard deduction of P5million will be imposed.FALSE
6. TRAIN aims to make the current tax system simpler, fairer, and more efficient.TRUE
7. Starting January 1, 2018 compensation earners, self-employed and professional taxpayers whose annual taxable incomes are P250,000 and
below or less than P21,000 a months is exempted from the personal income tax. TRUE
8. Agricultural products are exempted from VAT.TRUE
9. Cooperatives are also exempted from VAT. TRUE
10. Senior citizens are exempted from VAT. TRUE

III. ENUMERATE THE FOLLOWING

1.