TAX 102 PRELIM EXAM

Name: _______________________________ Yr&Sec: ___________Date:______________ Score______

Theory

Choose the correct answer.

A- Both statements are correct.

B- First statement is correct; Second statement is wrong.
C- First statement is wrong; Second statement is correct.
D- Both statements are wrong.

_____1. Business tax is a form of consumption tax.

Consumption tax is a form of business tax.
_____2. The consumption tax for purchases of goods or services from foreign sources shall be payable
by the buyer.
A purchase is a form of transaction.
_____3. Consumption is the acquisition or utilization of goods.
A tax on consumption would support savings initiative.
_____4. Both domestic and foreign consumption are subject to consumption.
Value Added Tax on importation is paid by the seller.
_____5. Consumption tax is more consistent on ability to pay theory.
Utilization or consumption of goods or services shall be taxable in the country of origin.
_____6. Importation is subject to either VAT or percentage tax.
VAT on importation is a business tax.
_____7. The importation of professional instruments and implements in commerce quantities is VAT-
exempt.
All agricultural or aquaculture inputs are VAT exempts.
_____8. The importation of books and newspapers is VAT-exempt.
The importation of life saving equipment is VAT – exempt.
_____9. The final withholding VAT on importation is payable even by those not engaged in business.
The purchase of services from domestic consultants is subject to final withholding VAT.

_____10. Importation of any product intended for human consumption is VAT exempt.
The final withholding VAT is 12% of the contract price of purchased service from within
Philippines.
Problems:

Problem 1

A business tax payer had the following purchases and receipts:

(in pesos)
Import of goods 110,000.00
Non-resident seller rendered services 90,000.00
Domestic Purchase of goods or services 120,000.00
Domestic Sale of goods or services 150,000.00
Export sales of goods services 60,000.00

1. Determine the total amount of which will be subject to consumption tax to business tax payer.
2. Determine the amount subject to consumption tax if the tax payer is not engaged in business.

Problem 2

Mia Worseback, a VAT -registered taxpayer recorded the following sales and purchases during the
month:

Domestic Sales (exclusive of tax 12%) 400,000.00

Purchases (inclusive of tax 12%) 250,000.00

3. What would be the Output VAT?

4. What is the VAT Input?
5. What is the VAT Payable?
6. Assuming, you will use direct credit method, what will be the VAT Payable?
Problem 3

Cartolina Gray, a business taxpayer recorded the following transactions during the month:

7. Assuming, tax payer is a VAT registered, compute for the amount subject to VAT on importation.
8. Related with no.7, how much will be VAT on importation?
9. Assuming, tax payer is a non-VAT registered, compute for the amount subject to VAT on
importation.
10. Related with no.9, how much will be VAT on importation?

Problem 4

Steve Havey, A VAT registered food retailer, imported the following from China:

11. Compute for amount exempt on VAT on Importation.

12. How much tax you will pay for exempted products?
13. Compute for VAT on importation.
Problem 5

Gloria Diaz Agricorp imported the following:

14. Compute for amount exempt on VAT on Importation.

15. Compute for VAT on importation.

Multiple Choice:

1. Which is VAT Exempt?

a. Peacock c. Hamsters
b. Eggs d. Leather

2. Which of these is VAT Exempt on importation?

a. Tea Leaves c. Cayenne Pepper
b. Tobacco Leaves d. Chinese cabbage

3. Which is not exempt from VAT?

a. Sunflower seeds c. Peanut
b. Bees wax d. None of these

4. Which is subject to VAT on importation when imported?

a. Books c. Mushroom
b. Table Sugar d. Ordinary salt

5. Which is vatable?
a. Bamboo shoots c. Banana Fruits
b. Banana hearts d. Bamboo poles
 6. Which is vat exempt?
a. Coconut lumber c. Coconut shells
b. Coconut broom sticks d. Coconut Meat

7. Which agricultural product is subject to VAT?

a. Honey c. Sugar Cane
b. Rattan Cane d. Sugar beets

8. Which is vat exempt?

a. Cotton soft wood c. Cotton wool
b. Cotton Seeds d. None of these

9. Which is vat exempt?

a. Corn seeds c. Flower seeds
b. Mustard seeds d. Cabbage seeds

10. Which is subject to VAT importation?

a. Formulated horse feeds c. Swine Feeds
b. Corn Grits d. Broiler Feeds

Bonus Question: (5pts)

Kung papipiliin ka sino ang mas maganda sa amin ni Catriona Gray, Bakit AKO?

-DEZ-