Vat Exercise Updated

1.
Dong Company, engaged in restaurant business, uses accrual basis of accounting in

its
financial statements. Its operation for the year ended shows the following:
Gross Revenue on account to customers 3,700,000
Gross Receipts from senior citizens, net of 20% discount 400,000
Purchases, directly attributable to customers other than senior citizens, net of VAT 300,000
Purchases, cannot be attributed, net of VAT 200,000
Direct Cost 2,000,000
Purchase of Equipment, used for all services rendered 600,000
Increase in Accounts Receivable (VAT inclusive) 224,000
Operating Expenses 1,000,000
Compute the Output VAT?
a. 420,000
b. 468,000
c. 396,000
d. 372,000
2. Wener Company is engaged in a hardware business. It uses accrual basis of

accounting in its
financial statements.
Gross Revenue 3,500,000
Sales Returns 200,000
Increase in Accounts Receivable, VAT inclusive 224,000
Increase in Inventory, net of VAT 150,000
Purchases 1,000,000
Supplies (40% from VAT sales), VAT exclusive 600,000
Services (60% from VAT sales), VAT exclusive 500,000
Other Operating Expenses 200,000
18. Compute the Output VAT?
a. 420,000
b. 396,000
c. 372,000
d. 360,000
3. J. Parada operates 9 passenger jeeps, a limousine service, a car detailing shop, and
a store
selling car and jeep parts and accessories. His sales and receipts during the year are shown
below:
Receipts, passenger jeeps ₱ 2,500,000
Receipts, limousine service 1,560,000
Receipts, car detailing shop 1,700,000
Sales, store 1,400,000
Total ₱ 5,460,000
(A) Mr. Parada is required to VAT-register.
(B) Mr. Parada is not required to VAT-register.
(C) Mr. Parada may optionally register his VAT-exempt businesses under the VAT
system.
(D) None of the above.
4. In the preceding number, may Mr. Parada optionally register his VAT-exempt
businesses
under the VAT system?
(A) Yes.
(B) No.
5. K imported, not VAT-registered imported articles whose customs duties were

based
on their volume. Total landed cost was determined to be P5,000,000 and excise taxes
on the said importation amounted to P1,000,000. He sold these articles to
Registered Business Enterprise (RBE). How much is the VAT payable on the
importation?
a. P960,000 c. P800,000
b. P720,000 d. None, importer is not VAT-registered
The sales/receipts GCC for the year are as follows:

From grocery store P2,000,000
From sale of goods to Asian Development Bank 1,500,000
From passenger jeepney 500,000
From agricultural food products (original state) 600,000
6. Which of the statements is correct?
a. The basis for VAT registration is P4,600,000.
b. The basis for VAT registration is P3,500,000.
c. The basis for VAT registration is P3,100,000.
d. The basis for VAT registration is P3,000,000.
The following information was gathered pertaining to the business of a VAT-registered

person for a taxable period.
VAT-subject sales P6,000,000
VAT-zero-rated sales 1,500,000
VAT-exempt sales 2,500,000
Input tax – VAT-subject sales 400,000
Input tax that cannot be allocated 300,000
7. How much shall be declared as total sales/receipts under line 19 (BIR Form
2550Q)?
a. P10,000,000 c. P7,500,000
b. P 8,500,000 d. P6,000,000
8. How much shall be the total VAT-subject sales?
a. P10,000,000 c. P7,500,000
b. P 8,500,000 d. P6,00,000
9. This refers to any person who is required to register under the

provisions of the Tax Code but failed to register.
a. VAT-registered person c. VAT-exempt person
b. VAT-registrable person d. None of the choices
10. In which of the following cases shall the selling price be deemed
inclusive of VAT?
I - If the gross selling price is based on the zonal value or market value of the
Property
II - If the VAT is not billed separately
a. I only c. Both I and II
b. II only d. Neither I nor II
11. Question 1 - What is the total amount of cash received from customers during the
year?
a. P10,980,000 c. P10,350,000
b. P10,477,500 d. None of the choices
12. Question 2 – How much is output tax?
a. P1,306,800 c. P1,242,000
b. P1,257,300 d. P1,177,200
13. Assuming the taxpayer is seller of goods, how much is the output tax for
the year?
a. P1,306,800 c. P1,242,000
b. P1,257,300 d. None of the choices
14. Ms. Consuelo Dimagulo receives a package of goods from her sister who
lives in California, United States of America. Ms. Consuelo will use the goods for
personal purposes. She is not VAT-registered. Which of the following statements is
correct in connection with the receipt of a package?
a. Ms. Consuelo shall be subject to VAT on importation.
b. Ms. Consuelo shall not be subject to VAT on importation because she is not VATregistered.
c. Ms. Consuelo shall not be subject to VAT on importation but shall be subject to
VAT on sales.
d. None of the choices.
15. An export sale of orchids and other ornamental plants of a VATregistered person is:
a. subject to 12% VAT. c. exempt from VAT.
b. subject to 0% VAT. d. none of the choices
16 and 17 are based on the following: (Business Taxes) VAT and Percentage Taxes ABC
Corporation, VAT-registered real estate dealer, sold a residential lot on July 2, 2018 for
P1,500,000. The down payment was P200,000. The zonal value of the subject property at the
time of sale amounted to P2,000,000.
16. Would the sale qualify under installment plan?
a. Yes, because the initial payment did not exceed 25% of the selling price.
b. No, because the amount of the initial payments were not known.
c. Yes, because the sale had initial payments and, therefore, qualified under
installment plan.
d. No, because, as a rule, sale of real property would always be considered sale
under cash basis.
Initial payment/selling price (300,000/1,500,000 = 20%) does not exceed 25%.
17. How much was the output tax on the installment payment?
a. P3,600 c. P2,000
b. P2,400 d. None
Sale of residential lot valued at P1,500,000 and below is exempt from VAT under the
TRAIN.
18. For purposes of the VAT, the following are embraced by the term goods or properties,
except:
a. Real property held primarily for lease in the ordinary course of trade or business
b. Radio, television, satellite transmission and cable television time
c. The right or the privilege to use motion picture films, films, tapes and discs
d. Sales of electricity by generation, transmission, and/or distribution companies.
19. Dodong Kaliwete, CPA sold his condominium unit where he and his family resides for
Php15,000,000. He purchased said family home for 8,000,000. The value-added tax on the sale
is:
a. Php0 b. Php1,800,000 c. Php840,000 d. Php450,000
20. One of the following does not result to output tax:

a. Domestic sale of goods;
b. Cash receipt on sale of services rendered in the Philippines
c. Export sale of goods;
d. Cash receipt on sale of services rendered outside of the Philippines.
21. All of the following are exempt from both the VAT and other percentage taxes, except:
a. Sale of books.
b. Sale of goods, services or importation other than those mentioned in paragraphs A to BB
of section 109 of the Tax Code where the annual gross receipts does not exceed
P3,000,000.
c. Importation of fertilizer.
d. Payment for service rendered under an employer-employee relationship.
22. On August 1, 2014, a real porperty dealer sold a commercial lot with the following
Zonal Value 6M
Assessed
Value 4.5M
Selling price 5M
A down payment of 500h was paid with the balance due in 36 monthly installments of 125h starting Sept 1, 2014.
a. How much is the output VAT on Aug 1 and Sept 1 respectively.

b. Assume that the down payment is 1000,000 pesos. How much is the output VAT on Aug 1, 2014?

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1.

Dong Company, engaged in restaurant business, uses accrual basis of accounting in

2. Wener Company is engaged in a hardware business. It uses accrual basis of

5. K imported, not VAT-registered imported articles whose customs duties were

The sales/receipts GCC for the year are as follows:

The following information was gathered pertaining to the business of a VAT-registered

9. This refers to any person who is required to register under the

20. One of the following does not result to output tax:

a. How much is the output VAT on Aug 1 and Sept 1 respectively.

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