1.

One of the following represents taxable income:

Refund of overpaid rental expense in prior year

2. Cash allowance of P250 per month given to Central Bank employee to cover the medical
expenses of their dependents shall be
Excluded from gross compensation income

3. This is not part of gross compensation income

Salary of PI 0,000 a month of a partner in a general professional partnership

4. Mr. A, a farmer, had the following data for the year: Sales of livestock and farm products
raised P270,000 Sales of livestock and farm products purchased P160,000 Cost of
raising livestock and farm products P190,000 Cost of livestock and farm products
purchased and sold P140,000 Rental income of farm equipment P105,000 Inventory of
livestock and farm products, January 1 P110,000 Inventory of livestock and farm
products, December 31 P113,000 A. Using cash method of accounting, the income is:
P205,000

5. Mr. A, a farmer, had the following data for the year: Sales of livestock and farm products
raised P270,000 Sales of livestock and farm products purchased P160,000 Cost of
raising livestock and farm products P190,000 Cost of livestock and farm products
purchased and sold P140,000 Rental income of farm equipment P105,000 Inventory of
livestock and farm products, January 1 P110,000 Inventory of livestock and farm
products, December 31 P113,000 A. Using accrual method of accounting, the income is:
P208,000

6. How much is the tax refund or tax due?A, a resident alien, single had the following
during the year: 1. Salaries (net of payroll deduction), P200,000 2: Allowances. P25,000
3. 13th month pay, P26,000 4. Christmas cash gift P10,000 5. 14th month pay, P26,000
6. Payroll Deductions a. Withholding tax on salary, P16,500 b. Contributions for SSS,
PHIC, PAG-IBIG, and labor union dues, P16,000 c. Advances/Loans, P30,000 7.
Premium on health and hospitalization insurance, P2,750 8. Bank interest income, net of
20 %, P1,400
-12200
7. How much is the tax refund or tax due?. A, resident citizen, single had the following
during the year 2018: Gross compensation income P480,000 Deductions from
compensation income: SSS contributions P3,600 Pag-ibig Contributions 1,200 Philhealth
Contributions 1,800 Union dues 2,400 Premium payments on health insurance
(P250/month) 3,000 Other income: Prizes and awards received as best athlete in the
Palarong Pambansa 10,000 Prizes and awards received for the silver medal in the South
East Asian 25,000 games Prize won in a Supermarket raffle 10,000 Prize won as a
Lucky Home Viewer 20,000 13th month pay 45,000 Christmas cash gift 10,000 Mid-year
bonus 45,000 Interest on bank deposit (net of 20% WT) 16,000 Interest on foreign
currency deposit (net of 15% WT) 10,000
51500

8. How much is the tax refund or tax due? D, a resident citizen, married, with 2 qualified
dependent children, had the following: Professional fees P400,000 Gross Income from
rental of conjugal properties 600,000 Expenses connected with profession 180,000
Expenses connected with rental properties 200,000 Tax withheld on professional fees
40,000 Tax withheld on rental of properties 30,000
-20000

9. The following incpme received by officials and employees in the public sector are not
subject to income tax and withhholding tax on compensation, except .
The excess of the 13th month pay and other benefits paid or accrued dunng the year
over P90,000

10. How much is the tax refund or tax due? D, married with 4 qualified dependent children,
had the following: Salary (net ofP19,000 SSS, Philhealth and Pag-ibig contributions &
Php 80,000 CWT) P400,000 13 th month pay 42,000 Productivity bonus 42,000
Premium payments on health insurance 2,400 Personal, family and living expenses
200,000
-30000

11. Which of the following statements is not correct?

 Monetization of leave credits of employees who were unable to go on leave due to
exigencies of the service constitutes taxable income.

12. As a rule, this is not part of taxable income

13 th month pay

13. This is taxable income

Separation pay due to resignation

14. Which of the following is taxable income?

Interest on Philippine lotto winnings

15. Which of the following is taxable?

P 12,000 prize in supermarket raffle

16. Gross benefits received by officials and employees of public and private entities as 13th
month pay and other benefits such as productivity bonus, services incentive pay and
Christmas bonus shall be excluded from taxable income up to
P90,000

17. One of the following is taxable income:

Amounts received as rewards from giving information instrumental in the discovery of
violations of the Tax Code and seizure of smuggled goods.

18. One of the following is part of taxable income subject to schedular

(graduated/progressive) rates:
Living quarters and meals furnished and given to a rank and file employee for the
convenience of the employee

19. Mr. Gigolo (resident citizen) appoints the Trust Department of Tyra Bank to manage his
money pursuant to a trust agreement. The Trust Department proceeds to invest the
money in a 5-year corporate bond. If instead, the bank in the immediately preceding
number, in the ame of Mr. Gigolo, invests the money in a 20-year long-term investment
 certificate issued by Bank of Ruptcy, will the interest income therefrom be exempt from
income tax?
Yes, provided the holding period of Mr. Gigolo and the holding period of the trust in the L
T investment certificate are both at least 5 years.

20. The following are taxed at a final rate of 20% except:

Interest and other payments upon. tax - free covenant bonds, mortgages, deeds of trust,
or other obligations under Section 57(C) of the Tax Code.

21. A) PCSO and Philippine lotto winnings (of more than'P10,000) of citizens and resident
aliens are excluded from gross income in the ITR because they are exempt from tax. . B)
All prizes, awards, winnings are excluded from gross income in the ITR because they
are subject to final tax
False, False

22. Which of the following is taxable income?

Interest on Philippine lotto winnings

23. Which of the following is part of gross income in the ITR?

Raffle prize not exceeding P10,000

24. Which of the following is taxable?

P 12,000 prize in supermarket raffle

25. Kaino sold his residential house and lot located in Manila on January 5, 2018 for
P8,000,000. The property was purchased in 2005 for P3,000,000. The current market
value of the property at the time of sale was: BIR Commissioner's zonal valuation -
P9,000,000 City Assessor's schedule of values - 6,000,000 What is the capital gains tax
on the sale?
P540,000

26. Kaino sold his residential house and lot located in Manila on January 5, 2018 for
P8,000,000. The property was purchased in 2005 for P3,000,000. The current market
value of the property at the time of sale was: BIR Commissioner's zonal valuation -
 P9,000,000 City Assessor's schedule of values - 6,000,000 If Kaino, within 6 months
after the sale, purchases another.residence for P8,000,000, what will be the capital gains
tax on the sale and what would be the cost (basis) of the new residence for income tax
purposes?
P0; P3,000,000

27. Kaino sold his residential house and lot located in Manila on January 5, 2018 for
P8,000,000. The property was purchased in 2005 for P3,000,000. The current market
value of the property at the time of sale was: BIR Commissioner's zonal valuation -
P9,000,000 City Assessor's schedule of values - 6,000,000 If Kaino, within the I8-month
reglementary period, instead purchases a new princjpal residence at a cost of
P5,000,000. What will be the capital gains tax on the sale ?
P202,500

28. Kaino sold his residential house and lot located in Manila on January 5, 2018 for
P8,000,000. The property was purchased in 2005 for P3,000,000. The current market
value of the property at the time of sale was: BIR Commissioner's zonal valuation -
P9,000,000 City Assessor's schedule of values - 6,000,000 If Kaino, within the I8-month
reglementary period, instead purchases a new princjpal residence at a cost of
P5,000,000. What would be the cost (adjusted basis) of the new residence for income
tax purposes?
P3,000,000

29. In 2019, Harold sold a property with the following data Selling Price: 700,000 Expenses
on sale: 40,000 Acquisition Cost: 400,000 Expenses incidental to acquisition 60,000.
The gain on sale is
200000

30. The data related to the exchange of a property are: Acquisition cost of the property
parted with: 800,000 Book value of the property partied with: 500,000 FMV of the
property partied with: 550,000, FMV of the property received: 720,000
220000
31. Tim sold shares of stock of a domestic corporation held as capital assets directly to a
buyer for P1,500,000, with a cost of P600,000. The capital gains tax would be
135000

32. Adam sold shares of stock of a domestic corporation held as capital for P600,000, with a
cost of P800,000. The capital gains tax would be
0

33. Frederick sold a real property located in the Philippines for 6,000,000. The property cost
him 4,000,000, plus an additional acquisition cost of 200,000. The property has a FMV of
5,500,000 on the date of sale
360000

34. Anthony was holding 5,000 shares of stock of a domestic held as capital assets costing
600,000. In 2019, he sold all the shares of stock directly to the buyers as follows: To Mr.
AA-2,000 shares of stock for P200,000 To Mr. BB- 3,000 shares of stock for P450,000.
What is the capital gains tax from the sale of stocks to Mr. AA?
0

35. Anthony was holding 5,000 shares of stock of a domestic held as capital assets costing
600,000. In 2019, he sold all the shares of stock directly to the buyers as follows: To Mr.
AA-2,000 shares of stock for P200,000 To Mr. BB- 3,000 shares of stock for P450,000.
What is the capital gains tax from the sale of stocks to Mr. AA?
13500

36. Ramon sold in 2019 an ordinary asset costing 1,400,000 and 3,500,000. The buyer
assumed the mortgage of 1,500,000 on the property and agreed to the following cash
payment: On the date of sale 400,000 Additional payment before the end of 2019:
300,000, Payment in 2020: 700,000 Payment in 2021. What is the income to be reported
in 2019?
800000

37. Ramon sold in 2019 an ordinary asset costing 1,400,000 and 3,500,000. The buyer
assumed the mortgage of 1,500,000 on the property and agreed to the following cash
 payment: On the date of sale 400,000 Additional payment before the end of 2019:
300,000, Payment in 2020: 700,000 Payment in 2021. What is the income to be reported
in 2020?
700000

38. Ramon sold in 2019 an ordinary asset costing 1,400,000 and 3,500,000. The buyer
assumed the mortgage of 1,500,000 on the property and agreed to the following cash
payment: On the date of sale 400,000 Additional payment before the end of 2019:
300,000, Payment in 2020: 700,000 Payment in 2021. What is the income to be reported
in 2021?
600000