Exercises Tax2

COLLEGE OF SCIENCE AND TECHNOLOGY
Cagamutan Norte, Leganes, Iloilo - 5003

Tel. # (033) 396-2291 ; Fax : (033) 5248081
Email Address : svcst_leganes@yahoo.com
COO – FORM 12
SUBJECT TITLE: BUSINESS TAXATION

INSTRUCTOR : MS. JENNIFER M. VILLEGAS, CPA
SUBJECT CODE: TAX 2
Topic 1 – Percentage Tax Exercises
1. Which of the following is not a major business internal revenue tax in the Tax Code?
a. Excise tax c. Value added tax

b. Percentage tax d. Income tax
2. X is an operator of parking lots. What business tax is due on his income from the business?
a. Broker’s tax c. Common carrier’s tax

b. Caterer’s tax d. Value added tax
3. Y is a dealer of liquors. On his sales in the Philippines, his tax is:
a. Excise tax c. Percentage tax

b. Value added tax d. None of the above
4. Which of the following is not true? The percentage tax
a. Is a tax on sale of services

b. May be imposed on a sale of goods
c. May be imposed together with the value added tax
d. May be imposed together with excise tax
5. What is the tax rate on gross receipts of a small business with P500,000 gross receipts for the year,
but opted to be registered under the VAT business?
a. 2% c. 12%
b. 3% d. None
6. Miss J, a jeepney operator with 5 units operating in Iloilo City reported P109,000 as gross receipts
for the quarter. Her percentage tax for the quarter is 3720
THIS IS AN EXCLUSIVE COPY OF ST. VINCENT COLLEGE. ANY UNAUTHORIZED REPRODUCTION IS PROHIBITED 1
Tel. # (033) 396-2291 ; Fax : (033) 5248081
7. The percentage tax rate on shares of stock traded in the stock exchange is 6/10 of 1%
8. The percentage tax should be paid
a. Within 20 days from the date of the transaction;

b. Within 30 days from the date of the transaction;
c. Within 25 days after the end of each taxable quarter;
d. Within 25 days after the close of each taxable month.
9. What would be the business tax rate on sales of a Cooperative Development Authority (CDA)
registered cooperative?
a. 2% of sale c. 10% of sales

b. 3% of sale d. None
10. Ms. S, a sari-sari store owner, not a VAT-registered person provides the following data for the year
2022:
Gross sales P500,000

Cost of sales 200,000
Merchandise inventory, end 100,000
Operating expenses 100,000
The amount of percentage tax payable is 5,000
11. Pedro Cruz is an operator of a fleet of taxis in Metro manila. Since he operates under the “boundary
system”, the actual payments to him by the taxi drivers of the “boundary” was P1,500,000. No
official receipts are issued to him by the taxi drivers. Drivers causing damage to the taxi units paid
Pedro Cruz P10,000 for the quarter.
The value added tax or percentage tax due from Pedro Cruz is: 45,000
12. Ms. T operates a domestic carrier in Iloilo City with the following receipts during the first quarter of
2022:
Ten (10 ) taxi units P240,000

Five (5) bus units with 60-seater capacity 1,000,000
Fifteen (15) two wheeled calezas carried by horses 150,000
The common carrier tax due is: 37,200
Tel. # (033) 396-2291 ; Fax : (033) 5248081
13. Gleim Company is a common carrier with passenger buses and cargo trucks. For the month of June,
2022, it had the data on revenues and receipts, taxes not included:
For transporting passengers, gross revenues and receipts of P330,000;
For transporting cargoes, gross revenues of P220,000, of which, P200,000 was received;
For renting out to its towing trucks, gross receipts of P50,000, representing P10,000 from gross
revenues of the quarter ending March 31 and P40,000 for the month of June.
Percentage tax: 9,900
14. In No. 13, the output value added tax: 30,000
15. Rabbit Company is a domestic carrier of goods and cargoes. It has the following receipts for the
quarter:
Transportation of goods by land P75,000

Transportation of goods by sea 150,000
Transportation of goods by air 200,000
The percentage tax due is 0
16. Y Company is a domestic carrier engaged in transport of passengers and cargoes. It has the following
receipts for the quarter:
Transportation of passenger by land P125,000

Transportation of cargoes by land 75,000
Transportation of passenger by sea 125,000
Transportation of cargoes by sea 250,000
The percentage tax due is 3,750
17. Star Company is a domestic carrier engaged in the transport of passengers and cargoes. It has the
following receipts for the quarter:
Transportation of passengers from the Philippines

to a foreign country P250,000
Transportation of cargoes from the Philippines to a foreign country 300,000
Transportation of passengers within the Philippines by land 100,000
Transportation of cargoes within the Philippines by land 125,000
Tel. # (033) 396-2291 ; Fax : (033) 5248081
18. In No. 17, the output value added tax at 12% rate is 15,000
19. Asian Tours and Cargoes Company is an international carrier, doing business in the Philippines, is
engaged in transportation of passengers and cargoes. It has the following receipts for the quarter:
Transportation of goods from the Philippines to abroad P500,000

Transportation of goods within the Philippines 250,000
Transportation of passengers from the Philippines to abroad 400,000
Transportation of passengers within the Philippines 200,000
20. As franchisee, Mr. A had the following data on revenues and receivables, taxes not included:
Receivables
Revenues Beginning Ending
From operations:
Covered by the franchise P2,000,000 P300,000 P400,000
Not covered by the franchise 600,000 80,000
The business taxes, before any tax credit, if selling water: 100,400
21. In No. 20, the business taxes, before any tax credit, if operating telephone services: 290,400
22. B Telecom Company is a franchise grantee rendering telephone and telegraph services. It has the
following receipts for the quarter:
From telephone and telegraph services

within the Philippines P1,000,000
From telephone and telegraph services from the Philippines
to abroad 1,500,000
23. X operates a racetrack. Other than the restaurant it operates, it also allows Y burger, a burger stand
operated by a concessionaire, to sell food inside its premises. The gross receipts during the month
are as follows:
From operation of racetrack P1,200,000

From restaurant 600,000
Tel. # (033) 396-2291 ; Fax : (033) 5248081
From television coverage 400,000
The gross receipts of Y burger amount to P450,000.
The gross receipts of Y burger are subject to: VAT
24. Mr. A, a retired military general, frequently goes to race tracks (for horses) and cockpits. For the
month of June 2022, Mr. A has the following winnings:
1. P100,000 form his winning ticket at the race track, the cost of the ticket is
P1,000; 9,900
2. P500,000 from his bets at cockpits;
3. P800,000 prize for his winning horse; 80,000
4. P400,000 prize for his winning fighting cock.
How much is the total percentage tax due / collected from Mr. A? 89,900
25. Juan Santos had the following records of his horse races in the 2 nd quarter of 2022:
Horses
1 Tiger 1st P 90,000
2 Doggie 3rd 250,000
3 Wolf 4th 60,000
4 Parrot 2nd 175,000
5 Eagle 5 th
None
How much percentage taxes were paid by Juan Santos? 57,500
26. A taxpayer had the following data on his transactions in marketable securities in the 3 rd quarter of
2022:
a. Shares of stock through the local stock exchange: 834.75

Cost Price P 250 per share
Sales Price 525 per share
Number of shares sold 265
b. Shares of stock sold through initial public offerings:
Tel. # (033) 396-2291 ; Fax : (033) 5248081
Ratio of shares sold to outstanding shares is over 33 1/3 % 3,600 shares were sold
at P52.50 per share 1,890
The total percentage tax due is: 2,724.75
27. What is the GRT rate applicable on gross receipts derived from sources within the Philippines by
banks and non-bank financial intermediaries from interest, commissions and discounts from lending
activities with maturity period of more than 5 years? 1%
banks and non-bank financial intermediaries from interest, commissions and discounts from lending
activities with maturity period of 5 years or less? 5%
banks and non-bank financial intermediaries from dividend? 0%
30. Statement 1: All winnings are subject to tax on winnings. F
Statement 2: Amusement taxes are imposed on all places of amusement. F
Tel. # (033) 396-2291 ; Fax : (033) 5248081
Topic 2 – Value Added Tax Exercises
Problem 1:
Alpha, an alcoholic beverage, classified as non-essential product was imported for sale. The particulars of
which are as follows: exchange rate is $ 1: P50
Value of importation as determined by the BOC $20,000.00
Freight and Insurance 30,000.00
Customs Duties 25,000.00
Other expenses prior to the release of goods from customs custody 15,000.00
Excise Tax 25%
Facilitation Expense 15,000.00
Transfer Costs from customs to the Importer's Warehouse 25,000.00
Selling Price of the Goods Imported 3,500,000.00
a) How much is the applicable excise tax? How much is the VAT on importation? 267,500: 160,500
b) How much is the creditable input tax? 163,500
c) How much is the output tax? 420,000
d) How much is the VAT payable? 256,500
Problem 2:
Ace Company, manufacturer of cooking oil made of corn, has the following data for the month:
Sales 5,000,000.00
Purchases, corn 2,500,000.00
Purchases, tin 450,000.00
Purchases of wrapping supplies 400,000.00
Purchases of labels VAT inclusive 325,000.00
a) How much is the output tax? 600,000

b) How much is the presumptive input tax? 100,000
c) How much is the total input tax? 236,824
Tel. # (033) 396-2291 ; Fax : (033) 5248081
Problem 3:
Neland, a manufacturer of sardines has the following data for the month of June:
Sales 15,000,000.00
Purchases, Fresh Fish - 3,000,000.00
Purchases, Fresh Tomatoes - 1,500,000.00
Purchases, Fresh Carrots - 1,500,000.00
Purchases, Tomato Paste – 2,000,000.00
Purchases, Cans - 3,500,000.00
Purchasing of Wrapping Supplies 450,000.00
Purchase of Labels 550,000.00
a) How much is the output tax? 1,800,000

b) How much is the presumptive input tax? 120,000
Problem 4:
AndJane Company decided to register under the VAT system on January 2, 2019 for the first time. The
following were from the 1st quarter ending March 31, 2019.
Sales 5,000,000.00
January - March 2019, Purchases 2,000,000.00
Inventory, Jan.1, 2019
From VAT Registered Suppliers, Net 500,000.00
From Non- VAT Registered suppliers, Net 3,000,000.00
a) How much is the output tax? 600,000

b) How much is the transitional input tax? 70,000
Tel. # (033) 396-2291 ; Fax : (033) 5248081
Problem 5:
Ace Company has the following transaction:
Sale of office supplies to the City of Manila, net of VAT 950,000.00
Purchases of office supplies sold to the city of Manila, Net of VAT. 560,000.00
a) Total amount of output vat? 114,000

b) Standard input vat? 0
c) VAT withheld? 47,500
d) Vat Payable/refund? (700)
e) Amount of actual input tax? 67,200
f) Amount of input VAT closed to income/loss 0
END

Exercises Tax2

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COLLEGE OF SCIENCE AND TECHNOLOGY

Cagamutan Norte, Leganes, Iloilo - 5003

SUBJECT TITLE: BUSINESS TAXATION

Topic 1 – Percentage Tax Exercises

a. Excise tax c. Value added tax

a. Broker’s tax c. Common carrier’s tax

3. Y is a dealer of liquors. On his sales in the Philippines, his tax is:

a. Excise tax c. Percentage tax

4. Which of the following is not true? The percentage tax

a. Is a tax on sale of services

8. The percentage tax should be paid

a. Within 20 days from the date of the transaction;

a. 2% of sale c. 10% of sales

Gross sales P500,000

The amount of percentage tax payable is 5,000

Ten (10 ) taxi units P240,000

The common carrier tax due is: 37,200

For transporting passengers, gross revenues and receipts of P330,000;

Percentage tax: 9,900

14. In No. 13, the output value added tax: 30,000

Transportation of goods by land P75,000

The percentage tax due is 0

Transportation of passenger by land P125,000

The percentage tax due is 3,750

Transportation of passengers from the Philippines

The percentage tax due is 3,000

Transportation of goods from the Philippines to abroad P500,000

The percentage tax due is 15,000

From telephone and telegraph services

The percentage tax due is 150,000

From operation of racetrack P1,200,000

From television coverage 400,000

The gross receipts of Y burger amount to P450,000.

The gross receipts of Y burger are subject to: VAT

2. P500,000 from his bets at cockpits;

3. P800,000 prize for his winning horse; 80,000

4. P400,000 prize for his winning fighting cock.

How much percentage taxes were paid by Juan Santos? 57,500

a. Shares of stock through the local stock exchange: 834.75

b. Shares of stock sold through initial public offerings:

The total percentage tax due is: 2,724.75

Topic 2 – Value Added Tax Exercises

Value of importation as determined by the BOC $20,000.00

Freight and Insurance 30,000.00

Customs Duties 25,000.00

Excise Tax 25%

Facilitation Expense 15,000.00

Transfer Costs from customs to the Importer's Warehouse 25,000.00

Selling Price of the Goods Imported 3,500,000.00

Purchases, corn 2,500,000.00

Purchases, tin 450,000.00

Purchases of wrapping supplies 400,000.00

Purchases of labels VAT inclusive 325,000.00

a) How much is the output tax? 600,000

Purchases, Fresh Fish - 3,000,000.00

Purchases, Fresh Tomatoes - 1,500,000.00

Purchases, Fresh Carrots - 1,500,000.00

Purchases, Tomato Paste – 2,000,000.00

Purchases, Cans - 3,500,000.00

Purchasing of Wrapping Supplies 450,000.00

Purchase of Labels 550,000.00

a) How much is the output tax? 1,800,000

January - March 2019, Purchases 2,000,000.00