Test 1-Theory (1 PT Each) - Write Only The Letter Which Corresponds To Your Chosen Answer

DEPARTMENT OF ACCOUNTING EDUCATION
Mabini St., Tagum City

Davao del Norte
Telfax: (084) 655-9591 Local 116
========================================================================================
\\
TAX 1A-3rd exam
Test 1- Theory (1 pt each) – Write only the letter which corresponds to your chosen answer.
1. The net share received by a partner in a general professional partnership is
a. Part of his taxable income
b. Exempt from income tax
c. Subject to corporate tax
d. Subject to final tax
2. The net shares received by a partner in a general co-partnership is
a. Part of his taxable income
b. Exempt from income tax
c. Subject to corporate tax
d. Subject to final tax
3. Statement 1- A CPA and a Dentist may form a GPP or an ordinary partnership
Statement 2- Partnership and Corporations have separate juridical personalities distinct from
the owners, as such partners and stockholders are not liable to creditors of the business
A. True, true C. False, true
B. False, false D. True, false
4. A general professional partnership is required to file income tax return
a. for purposes of paying income tax
b. for statistical purposes
c. because all income earners are required to file income tax returns
d. because the net income of the partnership will be traced into the income tax return of
the partners
5. Dividends paid by a domestic corporation maybe taxable but subject to final tax, except
a. if received by a resident citizen
b. if received by a resident alien
c. if received by a non-resident corporation
d. if received by another domestic corporation
6. This is taxable income
a. Retrenchment pay c. Separation pay due to resignation
b. SSS/GSIS benefits d. Refund of Philippine Income tax
7. Which statements is correct?
a. Incomes from illegal activities are taxable.
b. Tax refunds constitute taxable income to the taxpayer.
c. Recovery of bad debts previously written off is part of taxable income
d. As a rule, contest awards and prizes are subject to 20% final tax if they amount to P10,00 or more,
otherwise they will be exempt from income tax.
8. Facilities or privileges or offered or furnished or offered by an employer to his employees that
are of relatively small value and are offered or furnished by the employer merely as a means of
promoting the health, goodwill contentment, or efficiency of his employees.
a. Fringe benefit C. De minimis benefit
b. Fringe benefit tax D. Grossed-up monetary
Page 1 of 3
9. Which of the following is subject to fringe benefit tax?
a. compensation income of the rank and file employees
b. fringe benefit of the rank and file employees
c. compensation income of the managerial employees
d. fringe benefit of the managerial employees
10. The fringe benefit tax is
1. Imposed on the employer
2. Withheld at source
3. Deductible by the employer
a. 1 and 2 only c. 2 and 3 only
b. 1 and 3 only d. 1, 2 and 3
PART 2- PROBLEM SOLVING . (3 pts each)Present necessary solution in an ACCEPTABLE format
11. Mr. Reckless was injured in a vehicular accident in 2016. He incurred and paid medical
expenses of P25,000 and legal fees of P15,000 during the year. In 2017, he received P60,000 as
settlement from the insurance company which insured the car owned by the other party
involved in the accident. From the above payments and transactions, the amount of taxable
income to Mr. Reckless in 2017:
a. P20,000 b.zero c. P60,000 d. P35,000
12. Ms. Senior Citizen is an employee in a firm which gives fringe benefits to its rank-and-file
employees. In a retirement benefit plan, contributory on the part of both the employer and
employees, but not registered with BIR, Ms. Citizen had the following data on the retirement
pay she received in 2016:
Contributions by the employer P 150,000
Contributions by Ms. Citizen 50,000
Interest income of the fund on above contribution 20,000
Total amount received P 220,000
The taxable gross income of Ms Citizen
a. P220,000 b. P170,000 c. P20,000 d. P70,000
13. Mr. Bisligo surrendered his life insurance policy and received a cash surrender value of P
800,000 after contributing P 700,000 in annual premiums. Determine the total exclusion in
gross income and the inclusion in gross income, respectively?
a. P 800,000; P0 c. P 100,000;P 700,000
b. P 700,00; P100,000 d. P 0, P 800,000
14. Mandaue bought a car worth P 800,000 and registered it in the name of its supervisory
employee. Compute the monetary value.
a. P 800,000` b. P400,000 c. P 80,000 d. P0
15. In the immediately preceding problem, what is the fringe benefit tax assuming the employee is
a non-resident alien?
a. P430,769 b. P 266,667 c. P 215,385 d. P 133,333
Page 2 of 3
Mr. Suroyvisor is a manager of a manufacturing business owned by Riders, Inc. and was granted by
the company housing privilege. Assume the given figures for taxable year 2018 whenever necessary
to solve the requirements:
Monthly rental P 40, 000
Market value 12, 000, 000
Zonal value 11, 000, 000
Acquisition cost to Riders, Inc. 10, 000, 000
Acquisition cost to Mr. Suroyvisor 9, 000, 000
16. If the employer is leasing a house, how much is the monetary value of the fringe benefit?
a. 24, 000 b. 240, 000 c. 480, 000 d. 12, 000, 000
17. If the employer purchased the house where the employee resides, the grossed-up monetary
value of the fringe benefits is ( UNDER TRAIN LAW)
a. 384, 615 b. 330,882 b. 346,154 d. 769,231
For items 18-20

For the taxable year 2019, Julio and Julia, partners of a general professional partnership agreed to
divide profits and losses 70:30, respectively. Both are married without qualified dependents. The
following are the details of the accounts:
Sale of services, GPP P 2,450,000
Cost of Services, GPP 720,000
Itemized Deductions, GPP 580,000
18. How much is the distributable net income of the GPP assuming that the GPP used Itemized
deduction
a. P 1,730,000 b. P 692,000 c. P 1,150,000 d. P 1,038,000
19. How much is the share of each partner assuming that the GPP used Itemized deduction
a. Julio P 805,000 Julia P 345,000
b. Julio P 1,211,000 Julia P 519,000
c. Julio P 727,000 Julia P 311,000
d. Julio P 727,000 Julia P 311,000
20. How much is the distributable net income of the GPP assuming that the GPP used OSD
a. P 1,730,000 b. P 692,000 c. P 1,150,000 d. P 1,038,000
Page 3 of 3

Test 1-Theory (1 PT Each) - Write Only The Letter Which Corresponds To Your Chosen Answer

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Test 1-Theory (1 PT Each) - Write Only The Letter Which Corresponds To Your Chosen Answer

Uploaded by

Copyright:

Available Formats

DEPARTMENT OF ACCOUNTING EDUCATION

Mabini St., Tagum City

For items 18-20

You might also like