Saint Vincent’s College, Inc.

Dipolog City
2nd Semester 2021- 2022

COLLEGE OF BUSINESS AND ACCOUNTANCY

HIGHER EDUCATION DEPARTMENT BT 22

TERM QUIZ HURLY ALAMPAY, CPA,CTT,JD

NAME: ______________________________________ SCORE: __________________

COURSE/YEAR: ______________________________ DATE: _____________________

Multiple Choice. Write the letter of the correct answer. Erasures are strictly prohibited.
1. This is not part of the gross estate of the decedent
A. Conjugal property C. Share of the surviving spouse
B. Community property D. Exclusive property of the surviving spouse

2. All of the following are allowed as deduction from the gross estate of non-resident alien
decedent, but are prorated between Philippine gross estate and the world gross estate,
except:
A. funeral expense C. claims against the estate
B. unpaid taxes D. transfer for public purpose

3. One of the following is not an exemption or exclusion from the gross estate
A. Capital or exclusive property of the surviving spouse
B. Properties outside the Philippines of a non-resident French decedent
C. Shares of stock of Metro Pacific Investment Corporation of a non-resident Italian
D. The merger of usufruct in the owner of the naked title

4. X died leaving a farm land. In his will, he transferred the ownership thereof to Y but
subject to the condition that Z will have the right to use the land for a period of 15 years.
In the 12th year, however, Z died and in Z’s will he surrendered his right over the land to
Y.
A. The transfer is subject to donor’s tax
B. The transfer is both an inclusion from the gross estate
C. The transfer is subject to estate tax
D. The second transfer is exempt from transfer taxes

5. Rodolfo, a citizen of the Philippines and resident of Bacolod City, died testate on May 10,
1991. Among his gross estate were properties inherited from his deceased father who
died April 4, 1988. What percentage of deduction would be used in computing vanishing
deduction?
A. 80% B. 60% C.40% D. 20%

6. Donation made by the decedent during lifetime but to take effect upon his death shall be
exempt from donor’s tax.
The share of the surviving spouse in the conjugal property is part of the gross estate of
the decedent.
A. True, true B. True, false C. False, true D. False, false
7. Mr. Jose Cruz owned 100 hectares of agricultural land. The government took 95
hectares under the Agrarian Reform Act, with payment for it not yet received when Mr.
Cruz died. The administrator of Cruz inquired from you, what value shall be included in
the gross estate? What answer will you give him?
A. 100 hectares C. 5 hectares and receivable from Government
B. 5 hectares only D. Settle it with the Government.
8. A real property owned by the decedent was acquired for P1,000,000. Its fair market
value at the time of death was P1,500,000. Said property was mortgaged for P300,000
which remained unpaid at the time of death. For estate tax purposes, what value should
be included in the gross estate of the decedent?
A. P1,000,000 B. P1,500,000 C. P1,200,000 D. none of the choices

9. Which of the following will not be included as part in the term ‘funeral expenses”
A. Upkeep of the burial plot, tombstone, monument, or mausoleum.
B. Expenses incurred after internment, such as for prayers, masses, entertainment, etc.
C. Any portion of the funeral and burial expenses borne by relatives or friends.
D. All of these.

10. Estate tax is imposed upon the

A. Decedent C. property and right transferred
B. right to transfer properties D. privilege to receive

11. If transfer in contemplation of death, revocable transfer or property passing under general
power of appointment is made created, exercised or relinquished for consideration in
money or money’s worth, but there is no bona fide sale for an adequate and full
consideration in money or money’s worth, the gross estate will include:
A. Fair market value of such property at the time of transfer
B. Historical cost of such property at the time acquired.
C. Excess of the FMV of the property at the time of death over the value of the
consideration received.
D. FMV or assessed value of such property, at the time of death whichever is higher.

12. A taxpayer inquired from you how he can pass on certain properties to his son without
paying taxes and without violating any provision in the Tax Code. What suggestion will
you give him?
A. Procure life insurance policy appointing his children as irrevocable beneficiary.
B. Procure life insurance policy appointing his children as revocable beneficiary.
C. Transfer the property to his children through donation inter vivos.
D. Transfer the property for insufficient consideration and make it appear as sale.

13. For proceeds of life insurance not to constitute part of the gross estate
A. Must have been taken out by the decedent upon his life
B. Must have designated the estate of the decedent as irrevocable beneficiary
C. Must have designated a third person as, the decedent’s executor or administrator as
the irrevocable beneficiary
D. Must have designated a third person other than the estate, the decedent’s executor
or administrator as the irrevocable beneficiary

14. All of the following deductions can be availed by all decedents, except
A. Share of surviving spouse B. Vanishing deduction C. Losses D. RA 4917

15. Isabelo Reyes, a Filipino resident, died on September 5, 2018. The following losses
were incurred:
Loss from fire on February 2, 2019 of improvement
on his property compensated by insurance P100,000
Loss from flood on February 25, 2019 of household
furniture not compensated by insurance P200,000
Loss due to theft on September 15, 2019 P300,000
Loss from sale of property which part of the gross estate P50,000

The administrator asked you how much losses can be deducted from the gross estate.
What will be your advice?
A. P650,000 B. P600,000 C. P300,000 D. P200,000

16. Unpaid mortgage indebtedness is deductible from the gross estate provided the said
property subject to the indebtedness is included in the gross estate, before deducting the
mortgage indebtedness.
 A donation inter-vivos by the decedent to the Philippine government few months before
his death is not a deduction from the gross estate.
A. True, true B. True, false C. False, true D. False, false

17. A died giving B power to appoint who will inherit A’s house and lot. B however can only
choose among C, D, E and F. B decided to transfer the property to C, in B’s own will
when he was 90 years old already. The transfer from B to C is not subject to estate tax.

During X’s lifetime, he decided to give Y as gift his car subject to the condition that if Y
does not become a CPA within three years, X shall revoke the transfer. In the second
year however, X died. The car must form part X’s gross estate.
A. True, true B. True, false C. False, true D. False, false

18. You were appointed by the court as an administrator of the estate of N.A Mete. N.A Mete
died on March 15, 2019. The following unpaid taxes were presented to you:
Unpaid real estate tax for the second, third, fourth quarters of 2019 P90,000
Unpaid tax on income received by the estate of N.A Mete 20,000
Estate tax on the Estate of N.A Mete 50,000
Unpaid tax on income received by N.A Mete
for the period Jan 1 to March 15, 2019 3,000

How much should you claim as deductible unpaid taxes?

A. P163,000 B. P93,000 C. P90,000 D. None

19. The property, rights and obligations of a person which are not extinguished by his death
and those which accrued thereto since the opening of succession.
A. Assets B. Capital C. Estate D. Income

20. The term applied to the person whose property is transmitted through succession,
whether or not he left a will
A. Decedent B. Transferor C. Transferee D. Grantor

21. The term applied to the person whose property is transmitted through succession if he
left a will
A. Transferor B. Grantor C. Donor D. Testator

22. The person called to the succession either by the provision of a will or by operation of
law
A. Heir B. Devisee C. Legatee D. Trustor

23. The person to whom a gift of real property is given by virtue of a will
A. Heir B. Devisee C. Legatee D. Trustor

24. The person to whom the gift of personal property is given by virtue of a will
A. Heir B. Devisee C. Legatee D. Trustor

25. A donation inter vivos due to thought of death is

A, Subject to donor’s tax C. subject to estate tax if bonafide transfer
B. Subject to inheritance tax D. subject to estate tax if inadequate consideration

26. Which statement is wrong?

A. Claims against insolvent person should be included in the gross estate even if
uncollectible.
B. Revocable transfers are includible whether or not the right to revoked is exercised.
C. Transfer passing under special power of appointment is excluded from the gross
estate.
D. Transfer in contemplation of death and full consideration is still includible in the gross
estate.

27. An example of intangible property without is

A. Domestic shares of stock
B. Foreign shares, 85% of the business of the corporation is in the Philippines.
 C. Foreign shares with business in the Philippines.
D. Foreign shares, certificate of stock are kept in Makati.

28. In 2002, Cruz gave a loan of P150,000 to Maita, his secretary. In 2005, as an act of
generosity, J. Cruz condoned the debt of Maita in his last will and testament. J. Cruz
died in 2008. The condonation of the debt of Maita is
A. A donation inter vivos subject to donor’s tax.
B. A payment or compensation for the services rendered.
C. A deduction from the gross estate of J. Cruz.
D. A donation mortis causa subject to estate tax.

29. It refers to a mode of transferring and acquiring properties left by decedent.

A. Estate transfer B. succession C. donation D. Execution of a will

30. The following are transactions and acquisition exempt from transfer tax, except
A. Transmission from first heir or donee in favor of another beneficiary in accordance
with the desire of the predecessor.
B. Transmission or delivery of the inheritance or legacy by the fiduciary heir or legatee
to the fideicommisary.
C. The merger of usufruct in the owner of naked title.
D. All bequest, devisees, legacies or transfer to social welfare, cultural and charitable
institutions.

31. Which of the following is deductible?

A. Destruction of house by an earthquake which killed the decedent.
B. Shipwreck which occurred before the death of the decedent but was only discovered
after the burial.
C. Total wreckage of a car in an accident but was fully compensated by a
comprehensive insurance.
D. Theft which occurred during burial of the decedent.

32. A died leaving a farm land. In his will, he transferred the ownership thereof to B but
subject to the condition that C will have the right to use the land for a period of ten years
(usufruct). In the seventh year, C died and in C’s will he surrendered his right over the
land to B.
A. transfer is subject to Donor’s tax C. transfer is subject to estate tax
B. transfer is both inclusion from gross estate D. tax exempt transfer

33. Which shall not form part of the gross estate of the decedent?
A. Intangible personal property of a non-resident client w/out reciprocity
B. Revocable transfer
C. Transfer under special power of appointment
D. Life insurance proceeds where the executor is the beneficiary, irrevocable

34. Which statement is false about Succession:

A. The successor inherits all the transmissible property of a decedent including his
liabilities.
B. The successor can be made liable for the obligations of the decedent beyond the
value of the asset he received.
C. In succession, the successor can repudiate the inheritance.
D. In succession, fruits and credits maturing after the death of the decedent pass to the
heirs if they were not subjected to the estate tax.

35. One of the following statements is false:

A. Estate tax is an excise tax.
B. Estate tax is transfer tax on donation mortis causa.
C. The object of estate tax is to tax the property transferred from the dead to living.
D. Estate tax is based on redistribution wealth theory.

36. In determining the net estate of the decedent, which of the following rules is correct?
A. Real properties abroad are included in the gross estate of a decedent who is a non-
resident alien.
 B. Shares of stock being intangible property shall be included in the decedent gross
estate wherever situated.
C. There is no special deduction if the decedent is non-resident alien.
D. If silent, the designation of heirs on claiming the proceeds from life insurance is
irrevocable.

37. All of the following are personal properties situated in the Philippines, except:
A. Shares, obligations or bonds issued by any foreign corporation, doing business in the
Philippines.
B. Franchise which must be exercise in the Philippines.
C. Shares, obligations or bonds issued by any corporation or sociedad anonima
organized or constituted in the Philippines in accordance with laws.
D. Shares or rights in any partnership, business or industry established in the
Philippines.

38. Which statement is incorrect about claims against insolvent person?

A. They must be duly notarized.
B. They must be included in the gross estate even if uncollectible.
C. The deduction is only the uncollectible portion.
D. The insolvency of the debtor must be established.

You were appointed as administrator of the Estate of Julian Claudio. The following claims
against certain debtors were included in the gross estate:
Claims against an insolvent person (fully uncollectible) P500,000
Claims against a person who absconded (fully uncollectible) P300,000
Claims against an insolvent person (20% collectible) P100,000

39. How much shall you include as value of claims in the gross estate?
A. P900,000 B. 600,000 C. P580,000 D. None of the choices

40. How much shall you deduct from the gross estate?
A. P900,000 B. P600,000 C. P580,000 D. None of the choice

True or False. Write the word “true” if the statement is correct and “FALSE” if the statement is
incorrect. Erasures and alterations are strictly prohibited. 2 points per item.

1. Non-resident citizen can avail standard deductions amounting to P500,000. This

statement is incorrect.

2. Jewelries for personal use is exclusive property under absolute community of

properties. This statement is correct.

3. A will is an act whereby a person is permitted, with formalities prescribed by law, to

control to a certain degree the disposition of his estate to take effect during after
death. this statement is correct.

4. Person of either sex, under eighteen years of age, which an age of majority may
make a will. This statement is incorrect.

5. Donor’s tax is not an excise tax. Estate tax is a transfer tax. Both statements are
correct.

6. Properties received thru gratuitous title during the marriage are exclusive properties
under ACP and CPG. This statement is incorrect.

7. If a person dies leaving a will, the person is said to have died testate, a status known
as intestacy. This statement is incorrect.
8. A holographic will is a will written by the testator with his own hand, witnessed or
attested. This statement is incorrect.

9. All fruits under absolute community of properties are common. This statement is
correct.

10. Institution of an heir is an act by virtue of which a testator designates in his will the
person or persons who are to succeed him in his property and transmission rights
and obligations. This statement is incorrect.

11. Consanguinity is a relation of persons descending from the same stock or common
ancestors. This statement is correct.

12. If there is not pre-nuptial agreement, marriage celebration before August 8, 1988 is
under conjugal partnership of gains. This statement is correct.

13. A child already conceived at the time of the death of the decedent is capable of
succeeding provided it be born later. This statement is correct.

14. A property is subject to vanishing deduction if it has been acquired thru exchange,
when the property inherited w/in 5 years prior to the death of the present decedent.
This statement is incorrect.

15. Succession is a mode of acquisition by virtue of which the property, rights and
obligations to the extent of the value of the inheritance of a person, transmitted
through his death to others either by his will or by operation of law. The statement is
incorrect.

Goodluck…!!!!