SOLUTION PROBLEM 1

A Sales P5,500,000/112% ( 4,910,714.29) E Output tax on Net Sales

Less: Returns, allowances and discounts ( 120,000.00) Input Tax on Net Purchases ( 409,392.86)
Net Sales ( 4,790,714.29) Input Tax on Equipment and Supplies
( 14,142.85)
Vat Output Tax ( 574,885.71) VAT Payable

B Purchases ( 3,500,000.00)
Less: Returns, allowances and discounts 99,000/1.12 ( 88,392.86)
Net Purchases ( 3,411,607.14)
Vat Input Tax ( 409,392.86)

C Cash or Accounts Receivable ( 5,500,000.00)

Sales ( 4,910,714.29) F VAT Output Tax ( 574,885.71)
VAT Output Tax ( 589,285.71) VAT Input Tax
VAT Payable
Purchases ( 3,500,000.00)
VAT Input Tax ( 420,000.00)
Cash or Accounts Receivable ( 3,920,000.00)

D Sales returns, allowances and discounts ( 120,000.00)

VAT Output tax ( 14,400.00)
Cash or Accounts Receivable ( 134,400.00)

Cash or Accounts Payable ( 99,000.00)

VAT Input Tax ( 10,607.14)
Purchases returns, allowances and discounts ( 88,392.86)

Equipment (132,000/9.333%) ( 117,857.14)

Input VAT ( 14,142.86)
Cash or Accounts Payable ( 132,000.00)
( 574,885.71)

( 423,535.71)
( 151,350.01)

( 423,535.71)
( 151,350.01)
SOLUTION PROBLEM.2

1 Cash or Accounts Receivable ( 840,000.00)

Sales ( 750,000.00)
VAT Output Tax ( 90,000.00)

Sales returns, allowances and discounts ( 9,821.43)

VAT Output Tax ( 1,178.57)
Cash or Accounts Receivable ( 11,000.00)

Purchases ( 441,964.29)
VAT Input Tax ( 53,035.71)
Cash or Accounts Payable ( 495,000.00)

Cash or Accounts Payable ( 8,960.00)

VAT Input Tax ( 960.00)
Purchase retunrs, allowances and discounts ( 8,000.00)

2 Output Tax on Sales ( 90,000.00)

Output Tax on Returns, allowances and discounts ( (1,178.70)
Net VAT Output Tax ( 88,821.30)
Input Tax on Net Purchase (53035.71 -960) ( 52,075.71)
Transitional Input Tax (125,000 x 2%) ( 2,500.00) ( 54,575.71)
VAT payable ( 34,245.59)

3 VAT Output Tax ( 88,821.30)

VAT Input Tax ( 52,075.71)
Transitional Input Tax ( 2,500.00)
VAT Payable ( 34,245.59)
SOLUTION PROBLEM 3

1 Cash ( 1,320,000.00)
Service Income ( 1,178,571.43)
VAT Output Tax ( 141,428.57)

Cash ( 165,000.00)
Sales ( 147,321.43)
VAT Output Tax ( 17,678.57)

Cash ( 220,000.00)
Service Income ( 196,428.57)
VAT Output Tax ( 23,571.43)

Outside Services ( 171,875.00)

VAT Input Tax ( 20,625.00)
Cash ( 192,500.00)

Purchases ( 88,392.86)
VAT Input Tax ( 10,607.14)
Cash ( 99,000.00)

2 Amount Received for labor repairs, repainting and overhaul ( 1,320,000.00)

Amount Received for parts and paint used ( 165,000.00)
Amount received as advances on unfinished jobs ( 220,000.00)
Total Gross Receipts ( 1,705,000.00)

VAT Output Tax (1,705,000/9.333) ( 182,678.57)

Less: VAT Input Taxes on:
Outside services paid (192,500/9.333) ( 20,625.00)
Amount paid for parts and paints used (99,000/9.333) ( 10,607.14) ( 31,232.14)
VAT Payable for the month of July ( 151,446.43)
SOLUTION PROBLEM 4 a

1 Invoice cost of imported goods ( 1,500,000.00)

Custom duties ( 30,000.00)
Excise taxes ( 22,500.00)
Total Landed Cost ( 1,552,500.00)

Value-added tax on Importation (1,552,500 x 12%) ( 186,300.00)

a Vat Output tax on Sales (2090,000/9.333) ( 223,928.57)

Value-addded tax on Importation ( 186,300.00)
VAT Payable for the month of May ( 37,628.57)

b Vat Output Tax on Sales (1,320,000/9.333) ( 141,428.57)

Value-added Tax on Importation ( 186,300.00)
Excess VAT Input Tax applicable
a for the next month ( (44,871.43)

2 a VAT Output Tax ( 223,928.57)

VAT Input Tax ( 186,300.00)
VAT Payable ( 37,628.57)

b VAT Output Tax ( 141,428.57)

VAT Input Tax ( 141,428.57)

Note: VAT Input Tax will have a balance of P44,871.43 after this entry.