A real estate dealer sold a residential lot on January 5, 2019.

The following are the terms of sales:

Gross selling price (excluding VAT) P3.200,000

Down Payment, 10% (balance of 40% is payable in 36 equal monthly installments starting January 31,
2019 and the remaining balance of 50% upon turnover)
The zonal value of the residential lot is P4,000,000.

REQUIRED: Answer/compute the following:

1. What will be the basis of the VAT?

 Zonal value of P4,000,000

2. How much is the down payment before VAT?

 P400,000 (assumption, exclusive of VAT 12%)

3. What is the amount to be paid (ex VAT) before turnover?

 4,000,000 * 40% = P1,600,000

4. How much will be the monthly amortization (ex VAT) be?

 1,600,000 / 36 months = P44,444.44

5. What is the total amortization (VAT inclusive) during the year of sale?
 1,600,000 * 1.12 / 36 months * 12 months = P597,333.33

6. What is the initial payment?

 DP – P448,000 (4,000,000 * 1.12, VAT included)
P49,777.78 (initial payment, VAT inclusive)
P497,777.78

7. Is this sale on installment or on deferred payment basis?

 Installment Basis

8. How much is the output tax related to the event on January 5, 2019?
 4,000,000 * 1.12 * 10% = P448,000
480,000 (output tax)
10%
P48,000

9. How much is the output tax related to the event on January 31, 2019?
 48,000 (from no. 8 + 5,333.33) = 53,333.33
49,777.78 (first payment VAT inclusive)
(44,444.45) (first payment Vat exclusive)
P5,333.33
10. How much is the total output related to this sale for 2019?
 (480,000 / 36 months) * 12 months (2019) = P160,000