BM2215

SUMMATIVE EXAM: PRELIM PERIOD (PERFORMANCE TASK)

Abdao, Rianna Cecilia S.
BSBA OM I403
Read and analyze each item. Choose the letter of the correct answer. (25 items x 2 points)

1. Analyze the following statements:

Statement I: The Constitution is the source of the State's taxing power.
Statement II: The police power of the government may be exercised through taxation.
a. Statement I is correct. c. Both statements are correct.
b. Statement II is correct. d. Both statements are incorrect.

2. Which of the following requires public improvement?

I. Taxation
II. Police Power
III. Eminent Domain
a. I only c. III only
b. I and II only d. II and III only

3. Which of the following DOES NOT state the differences among the inherent powers of the State?
a. The property taken under eminent domain and taxation is preserved, but that of the police is
destroyed.
b. Eminent domain does not require a constitutional grant, but the formidable taxation limits its
existence by the legislature.
c. Police power and taxation are exercised only by the government, but private entities may exercise
eminent domain.
d. Police power regulates property and liberty, while eminent domain and taxation only affect property
rights.

4. Which of the following statements is FALSE?

a. The government can only enforce contribution upon its citizens when the Constitution grants it.
b. The government automatically possesses the power to collect taxes from its inhabitants.
c. Taxation power exists inseparably from the State.
d. The State has the supreme power to command and enforce contributions from the people within its
jurisdiction.

5. Analyze the following statements:

Statement I: The Constitution cannot take away the inherent powers of the State but may only prescribe
its limitations.
Statement II: There are laws necessary to confer the inherent powers of the State upon any government
exercising sovereignty.
a. Statement I is correct. c. Both statements are correct.
b. Statement II is correct. d. Both statements are incorrect.

6. Which of the following statements is/are CORRECT?

I. Taxes are pecuniary in nature.
II. Taxes co-exist with the existence of the State.
III. Taxes are imposed on persons and property beyond the territorial jurisdiction of the State.
a. I only b. II only
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c. I and
II only
d. I, II,
and III

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7. Analyze the following statements:

Statement I: The amount of money raised for the government in exercising its power to tax and police
power is not based on the needs of the government.
Statement II: The money raised for the government to exercise its eminent domain power is based on the
cost of processing property transfers from private entities or individuals to the government.
a. Statement I is correct. c. Both statements are correct.
b. Statement II is correct. d. Both statements are incorrect.

8. Which of the following statements is TRUE?

a. The government and its political subdivision exercise the power of taxation and eminent domain.
b. In police power, the property taken is preserved for public use.
c. The Constitution creates the power of eminent domain.
d. The exercise of the power of eminent domain and police power can be expressly delegated to the
local government units by the lawmaking body.

9. Which of the following may NOT raise money for the government?
a. Power of taxation c. Power of eminent domain
b. Police power d. Privatization of the government's hospital

10. It is the reciprocal duty of support and protection between the people and the government.
a. Basis of Taxation c. Scope of Taxation
b. Situs of Taxation d. Theory of Taxation

11. Which of the following statements expresses the lifeblood theory?

a. The government must enforce the assessed taxes.
b. The underlying basis of taxation is government necessity, for a government can neither exist nor
endure without tax.
c. Taxation is an arbitrary method of exaction by those who are in the seat of power.
d. The power of taxation is an inherent power of the sovereign to impose burdens upon subjects and
objects within its jurisdiction to raise revenues.

12. Which of the following is the principal purpose of taxation?

a. Encourage the growth of home industries through the proper use of tax incentives.
b. Implement the police power of the State.
c. Reduce excessive inequalities of wealth.
d. Raise revenue for governmental needs.

13. After having been informed that most of the massage parlors in the city are being used as fronts for
prostitution, the Sangguniang Panlungsod of Manila passed a tax ordinance subjecting massage parlors
within its jurisdiction to such "onerous taxes" that leave them no other alternative but to stop operating.
The passage of the law is a valid practice of which of the following?
a. Taxation c. Eminent domain
b. Police power d. Police power and power of taxation

14. A tax must be imposed for a public purpose. Which of the following is NOT a public purpose?
a. National Defense c. Improvement of the sugar industry
b. Public Education d. None of the choices

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15. Which of the following is the levying and imposition of tax and the collection of tax processes which
constitute the taxation system?
a. Basis of Taxation c. Nature of Taxation
b. Aspects of Taxation d. Theory of Taxation

16. Which of the following are the aspects of taxation?

I. Levying or imposition of the tax on persons, property, or exercise
II. Collection of taxes already levied
III. Sufficiency of governments sources to satisfy its expenditure
a. I, II, and III c. I and III only
b. I and II only d. II and III only

17. Which of the following is the official action of an officer authorized by law to ascertain the amount of tax
due from a taxpayer?
a. Assessment c. Deficiency
b. Delinquency d. Distraint

18. Taxation is exercised both by the legislative and executive branches of the government. Which of the
following is NOT the function of Congress?
a. Selecting the kind of tax c. Prescribing rules of taxation
b. Fixing the amount of tax d. Assessment of tax liability

19. Which of the following is NOT a legislative aspect of taxation?

a. Selection of the object or subject of tax c. Fixing tax rates
b. Valuation of property for taxation d. Prescribing the general rules of taxation

20. Which of the following is NOT an administrative function of taxation?

a. Selection of object of tax c. Valuation of property for taxation
b. Equalization of assessment d. Collection of taxes

21. Which basic principle of a sound taxation system states that taxes must be based on taxpayers' ability to
pay?
a. Equality in taxation c. Theoretical justice
b. Ability to pay theory d. Equity in taxation

22. Which of the following means that the tax law must be capable of convenient, just, and effective
administration?
a. Theoretical justice c. Administrative feasibility
b. Fiscal adequacy d. Rule of apportionment

23. Which of the following is NOT constituted of double taxation?

a. Both taxes are imposed in the same amount.
b. Both taxes are levied for the same purpose.
c. The same taxing authority imposes both taxes.
d. Both taxes are imposed upon the same person.

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24. Which of the following is NOT double taxation?

a. A lessor of the property pays a real estate tax and income tax on the same property.
b. Imposition of tax on the finished products and raw materials used in the production of the said
finished products
c. Imposition of tax on corporate income and shareholder's dividends from the same corporation
d. All the choices

25. Which of the following means "place of taxation" where the country has the power and jurisdiction to
levy and collect the tax?
a. Basis of taxation c. Scope of taxation
b. Situs of taxation d. Theory of Taxation

Reference:
Tabag, E. (2022). CPA reviewer in taxation. EDT Books Publishing.

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