4-DAC

C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
1. HOW MUCH IS THE VAT THRESHOLD?
A. 1,191,500
B. 1,991,000
C. 1,199,500
D. 1,919,500
ANSWER: D
2. VAT IS IMPOSED ONLY IN THE COUNTRY WHERE THE GOODS OR SERVICES ARE CONSUMED.
THIS PRINCIPLE WOULD REFER TO
A. DESTINATION PRINCIPLE
B. JURISDICTION PRINCIPLE
C. CROSS BORDER PRINCIPLE
D. CONSUMER PRINCIPLE
ANSWER: A
3. STATEMENT 1: THE WITHHOLDING VAT IS REMITTED WITHIN 20 DAYS AFTER WITHHOLDING
WAS MADE.
STATEMENT 2: IF THE PURCHASER IS NOT ENGAGED IN BUSINESS, THE VAT ON IMPORTATION
OR WITHHOLDING VAT IS MERELY ADDED TO THE COSTS OF IMPORTATION.
A. ONLY THE FIRST STATEMENT IS TRUE
B. ONLY THE SECOND STATEMENT IS TRUE
C. BOTH STATEMENTS ARE TRUE
D. BOTH STATEMENTS ARE FALSE

ANSWER: B
4. MR. JIN BECAME LIABLE TO VAT AFTER EXCEEDING THE VAT THRESHOLD IN NOVEMBER
2015. HE HAD THE FOLLOWING BEGINNING INVENTORY FOR DECEMBER 2015:
VAT-EXEMPT GOODS
VATABLE GOODS:
PURCHASED FROM NON-VAT SELLERS
PURCHASED FROM VAT SELLERS
TOTAL BEGINNING INVENTORY

P20,000
P60,000
P11,200
P91,200

HOW MUCH IS THE TRANSITIONAL INPUT VAT?

A. P1,800
B. P1,824
C. P1,424
D. P1,400
ANSWER: D
5. A REAL ESTATE CORP SOLD WITHIN A YEAR, 2 ADJACENT RESIDENTIAL LOTS IN
MANDALUYONG CITY FOR A PRICE OF PHP 1,000,000 EACH, TO A VENDEE WHO INTENDS
TO BUILD HIS RESIDENTIAL HOUSE THEREON. AT WHAT PERCENTAGE IS IT SUBJECT TO VAT IF

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
ANY?
A.

12%
B. 3%
C. 0%
D. VAT EXEMPT
ANSWER: A
6. CPA REALTY CORP SOLD THE FOLLOWING REAL PROPERTIES DURING THE TAXABLE YEAR:
3 UNITS OF RESIDENTIAL HOUSE AND LOT AT PHP 2,900,000 EACH
8,700,000
4 RESIDENTIAL LOTS AT PHP 2,500,000 EACH
10,000,000
1 COMMERCIAL LOT AT PHP 3,000,000
3,000,000
HOW MUCH IS THE TOTAL TRANSACTIONS THAT ARE SUBJECT TO VAT?
A. 21,700,000
B. 18,700,000
C. 11,700,000
D. 13,000,000
ANSWER: D
7. A FARMER SOLD THE FOLLOWING GOODS DURING MARCH:
20 SACK RICE
100 SACK CORN
TOTAL

45000
90000
135000

DETERMINE THE GROSS SELLING PRICE SUBJECT TO BUSINESS TAX.

A. P 0
B. P 45000
C. P 90000
D. P 135000
ANSWER: A
8. WHICH IS NOT EXEMPT FROM BUSINESS TAX?
A. MILLER OF PALAY INTO RICE
B. MILLER OF CORN INTO CORN GRITS
C. MILLER OF SUGAR CANE INTO REFINED SUGAR
D. MILLER OF SUGAR CANE INTO RAW SUGAR
ANSWER: C
9. WHICH TRANSACTION IS SUBJECT TO VAT?
A. SALE OF VEGETABLES BY A FARMER IN BAGUIO CITY TO A VEGETABLE DEALER.
B. SALE OF VEGETABLES BY A VEGETABLE DEALER IN BAGUIO CITY TO ANOTHER VEGETABLE
DEALER IN QUEZON CITY.
C. SALE OF VEGETABLES BY THE QUEZON CITY DEALER TO A RESTAURANT IN MANILA.

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
D.

SALE OF VEGETABLES BY THE RESTAURANT OPERATOR TO ITS CUSTOMERS.

ANSWER: D
10.JOEY, A NON-VAT TAXPAYER, PURCHASED MERCHANDISE WORTH P11,200, VAT INCLUSIVE,
FROM WILLIE, A VAT REGISTERED SELLER. THE PASSED ON VAT OF P1,200 ON THE
PURCHASES IS
A.

AN EXPENSE
PART OF THE COST OF PURCHASES
C. A TAX CREDIT
D. IGNORED
B.

ANSWER: B
11.SALE OF REAL ESTATE IS SUBJECT TO VAT
A. TRUE, IF MADE IN THE REGULAR COURSE OF TRADE OR BUSINESS
B. FALSE, IT IS EXEMPT IF THE REAL ESTATE IS NOT CLASSIFIED AS CAPITAL ASSET.
C. FALSE, IT IS EXEMPT IF WHAT IS SOLD IS A RESIDENTIAL UNIT.
D. TRUE, IF WHAT IS SOLD IS A RESIDENTIAL UNIT
ANSWER: A
12.DOMESTIC SALE OF BAGOONG IS:
A. EXEMPT FROM VAT
B. SUBJECT TO 12% VAT IF GROSS ANNUAL SALES EXCEED P1.5M
C. SUBJECT TO 0% VAT
D. SUBJECT TO 3% PERCENTAGE TAX IF EXEMPT FROM VAT
E. B AND D ARE CORRECT
ANSWER: A
13.ALL OF THE FOLLOWING ARE EXEMPT AGRICULTURAL PRODUCE, EXCEPT
A. PALAY
B. CORN
C. SUGAR
D. TOBACCO
ANSWER: D
14.WHICH OF THE FOLLOWING IS (ARE) VAT-EXEMPT TRANSACTION(S)?
A. SERVICES RENDERED BY REGIONAL OPERATING HEADQUARTERS.
B. SERVICES PERFORMED BY INDIVIDUALS IN PURSUANT TO AN EMPLOYER AND EMPLOYEE
RELATIONSHIP.
C. IMPORTATION OF EXEMPT MARINE OR AGRICULTURAL PRODUCTS
D. IMPORTATION OF FUEL, GOODS AND SUPPLIES BY PERSONS ENGAGED IN INTERNATIONAL
SHIPPING OR AIR TRANSPORT OPERATIONS

ANSWER: A
15.UNDER THE VAT SYSTEM, THERE IS NO CASCADING BECAUSE THE TAX ITSELF IS NOT AGAIN
BEING TAXED. HOWEVER, IN DETERMINING THE TAX BASE ON SALE OF TAXABLE GOODS

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
VAT SYSTEM:
THE PROFESSIONAL TAX PAID BY PROFESSIONAL IS INCLUDED IN GROSS RECEIPTS.
B. THE OTHER PERCENTAGE TAX (E.G., GROSS RECEIPTS TAX) PAID BY THE TAXPAYER IS
INCLUDED IN GROSS SELLING PRICE.
C. THE EXCISE TAX PAID BY THE TAXPAYER BEFORE WITHDRAWAL OF THE GOODS FROM THE
UNDER THE
A.

PLACE OF PRODUCTION OR FROM CUSTOMS CUSTODY IS INCLUDED IN THE GROSS SELLING

PRICE.
D.

THE DOCUMENTARY STAMP TAX PAID BY THE TAXPAYER IS INCLUDED IN THE GROSS

SELLING PRICE OR GROSS RECEIPTS.

ANSWER: C
16.EXCEPT FOR ONE TRANSACTION, THE REST ARE EXEMPT FROM VALUE ADDED TAX. WHICH
ONE IS VAT TAXABLE?
A. SALES OF CHICKEN BY RESTAURANT OWNER WHO DID NOT REGISTER AS A VAT PERSON
AND WHOSE GROSS ANNUAL SALES IS P1,200,000.
B. SALES OF COPRA BY A COPRA DEALER TO A COCONUT OIL MANUFACTURER WHO DID NOT
REGISTER AS A VAT PERSON AND WHOSE GROSS ANNUAL SALES IS P5,000,000.
C. GROSS RECEIPTS OF A CPA DURING THE YEAR AMOUNTED TO P1,000,000; THE CPA
REGISTERED AS A VAT PERSON IN JANUARY 2013, BEFORE PRACTICING HIS PROFESSION.
D. SALES OF A BOOK STORE DURING THE YEAR AMOUNTED TO P10,000,000; IT DID NOT
REGISTER AS A VAT PERSON WITH THE BIR.
ANSWER: C
17.IT REFERS TO THE PURCHASE OF GOODS INCLUDING SERVICES BY PHILIPPINE RESIDENTS
FROM NON-RESIDENTS SELLERS.
A. IMPORTATION
B. SALE
C. CONSIGNMENT
D. CONSUMPTION
ANSWER: A
18.WHICH IS NOT BELONG TO THE GROUP?
A. VALUE ADDED TAX
B. PERCENTAGE TAX
C. EXCISE TAX
D. INCOME TAX
ANSWER: D
19.STATEMENT 1: A PERSON SUBJECT TO EXCISE TAX IS ALSO SUBJECT TO VALUE-ADDED TAX.
STATEMENT 2: A PERSON SUBJECT TO PERCENTAGE TAX IS ALSO SUBJECT TO VALUE-ADDED
TAX.
A.

BOTH STATEMENT ARE CORRECT

B. BOTH STATEMENT ARE WRONG
C. STATEMENT 1 IS CORRECT WHILE STATEMENT 2 IS WRONG

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
D.

STATEMENT 2 IS CORRECT WHILE STATEMENT 1 IS WRONG

ANSWER: C
20.WHICH STATEMENT IS CORRECT?
THE VALUE-ADDED TAX ON IMPORTATION:
A. SHOULD BE PAID BY THE TAX-EXEMPT IMPORTER, IF HE SUBSEQUENTLY SELLS THE GOODS
TO A NON-TAX-EXEMPT PURCHASER
B. SHALL NOT PAY THE VALUE ADDED TAX BECAUSE THE TRANSACTION WAS EXEMPT AT THE
POINT OF IMPORTATION
C.

SHOULD BE PAID BY THE NON-TAX-EXEMPT PURCHASER TO WHOM THE TAX-EXEMPT

IMPORTER SELLS IT.

D. IS A LIABILITY EITHER OF THE TAX EXEMPT IMPORTER OR THE NON-TAX-EXEMPT
PURCHASER.

ANSWER: C
21.WHICH OF THE FOLLOWING SALES WILL BE EXEMPT FROM VALUE-ADDED TAX?
A. SALE OF COPRA
B. SALE OF COTTON AND COTTON SEEDS IN THEIR ORIGINAL STATE
C. SALE OF COAL AND NATURAL GAS IN ITS ORIGINAL STATE
D. SALE OF NON-FOOD AGRICULTURAL PRODUCTS IN THEIR ORIGINAL STATE
ANSWER: A
22.ANA, OWNS A MANGO PLANTATION. SHE HARVESTED RIPE MANGOES AND SOLD THEM TO
ALMA A FRUIT STAND OWNER AND TO ANGGE, A FRESH FRUIT VENDOR WHOSE ANNUAL
GROSS SALES NEVER EXCEEDED P1,919,500. WHICH SALE SHALL BE EXEMPT FROM VAT?
A. SALE TO ALMA ONLY
B. SALE TO ANGGE ONLY
C. SALE TO BOTH ALMA AND ANGGE
D. SALE TO BOTH ALMA AND ANGGE IS SUBJECT TO VAT
ANSWER: C
23.THE ACCOUNT TITLE TO BEST REFLECT THE VAT ON A PURCHASE:
A. SALES TAX PAYABLE
B. VAT PAYABLE
C. INPUT TAX
D. OUTPUT TAX
ANSWER: C
24.ZERO-RATED TAXPAYERS ARE NOT REQUIRED TO PAY OUTPUT VAT, BUT THEY ARE
REGISTERED UNDER:
A. VAT SYSTEM
B. NON-VAT SYSTEM
C. EXCISE TAX SYSTEM
D. MIXED SYSTEM
ANSWER: A

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
25.WHICH OF THE FOLLOWING IS NOT AN OBJECT OF VAT
A. SALES OF GOODS/PROPERTIES
B. SALES OF SERVICES
C. IMPORTATION
D. COMPENSATION INCOME
ANSWER: D
26.TO BE VAT EXEMPT, THE SALES PRICE OF RESIDENTIAL HOUSE AND LOT MUST BE
A. P2,500,000
B. P3,200,000
D. P3,199,200
D. P1,919,500
ANSWER: C
27.GIVEN THE FOLLOWING GOODS, WHICH OF THEM IS SUBJECT TO VAT ON IMPORTATION
A. FROZEN MEAT
B. WHEAT
C. FLOUR
D. UREA FERTILIZER
ANSWER: C
28.WHICH IMPORTATION IS SUBJECT TO THE VAT ON IMPORTATION?
A. IMPORTATION BY A PERSON ENGAGED IN BUSINESS
B. IMPORTATION BY A PERSON NOT ENGAGED IN BUSINESS
C. BOTH A OR B
D. NEITHER A NOR B
ANSWER: C
29.THE FOLLOWING ARE PERSONS LIABLE TO VAT EXCEPT
A. A PERSON, WHO IN THE COURSE OF TRADE OR BUSINESS, SELLS GOODS OR PROPERTIES
B. A PERSON, WHO IN THE COURSE OF TRADE OR BUSINESS, EXCHANGES GOODS OR
PROPERTIES
C.

A PERSON, WHO IN THE COURSE OF TRADE OR BUSINESS, BARTERS GOODS OR

PROPERTIES
D.

A, B AND C ARE PERSONS LIABLE TO VAT

ANSWER: D
30.WHAT IS THE TAX BASE OF SELLING GOODS OR PROPERTIES?
A. GROSS SELLING PRICE
B. GROSS RECEIPTS
C. LANDED COST
D. NONE OF THE ABOVE
ANSWER: A
31.A SUBDIVISION DEVELOPER SOLD FIVE (5) RESIDENTIAL HOUSE AND LOTS, EACH TO
DIFFERENT VENDEES, FOR P3,000,000 PER LOT, OR A TOTAL SALES OF P15,000,000 FOR

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
THE TAXABLE PERIOD.

THESE SALES SHALL BE CLASSIFIED AS:

A. 12% VAT TRANSACTIONS
B. 0% VAT TRANSACTIONS
C. VAT EXEMPT TRANSACTIONS
D. NONE OF THE FOREGOING
ANSWER: C
32.GROSS SELLING PRICE INCLUDES ALL OF THE FOLLOWING EXCEPT ONE. WHICH ONE?
A. TOTAL AMOUNT WHICH THE PURCHASER PAYS TO THE SELLER.
B. TOTAL AMOUNT WHICH THE PURCHASER IS OBLIGATED TO PAY TO THE SELLER.
C. EXCISE TAX.
D. VALUE-ADDED TAX
ANSWER: D
33.VALUE-ADDED TAX IS A/AN
A. INDIRECT TAX
B. DIRECT TAX
C. PROGRESSIVE TAX
D. REGRESSIVE TAX
ANSWER: A
34.CONSIGNMENT OF GOODS SHALL BE DEEMED SOLD BY THE CONSIGNOR IF THE GOODS WERE
UNSOLD AND NOT RETURNED BY THE CONSIGNEE OVER
A.

30 DAYS
60 DAYS
C. 90 DAYS
D. 120 DAYS
B.

ANSWER: B
35.THE TAX ON DOMESTIC CONSUMPTION FROM FOREIGN SUPPLIERS IS
A. VAT ON IMPORTATION
B. BUSINESS TAX
C. EITHER A OR B
D. NEITHER A OR B
ANSWER: A
36.STATEMENT 1: DOMESTIC CONSUMPTION ARE SUBJECT TO CONSUMPTION TAX.
STATEMENT 2: FOREIGN CONSUMPTION ARE SUBJECT TO CONSUMPTION TAX.
WHICH STATEMENT IS CORRECT?
A. STATEMENT 1 ONLY
B. STATEMENT 2 ONLY
C. BOTH STATEMENTS
D. NEITHER STATEMENT

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
ANSWER: A
37.THE FOLLOWING ARE THE SOURCES OF REGULAR OUTPUT VAT EXCEPT:
A. SALE OF GOODS
B. SALE OF SERVICES
C. SALE OF PROPERTIES
D. TRANSACTIONS NOT DEEMED SALES

ANSWER: D
38.THE FOLLOWING ARE THE SOURCES OF REGULAR OUTPUT VAT EXCEPT:
A. SALE OF GOODS
B. SALE OF SERVICES
C. SALE OF PROPERTIES
D. TRANSACTIONS NOT DEEMED SALES
ANSWER: D
39.AN IMPORTER OF FLOWERS FROM ABROAD IN 2015:
A. IS LIABLE FOR VAT, IF IT REGISTER AS A VAT PERSON.
B. IS EXEMPT FROM VAT, PROVIDED THAT HIS TOTAL IMPORTATION OF FLOWERS DOES NOT
EXCEED PHP 1,919,500
C. IS EXEMPT FROM VAT, BECAUSE THE GOODS ARE TREATED AS AGRICULTURAL PRODUCTS.
D. IS LIABLE FOR VAT, DESPITE THE FACT THAT IT DID NOT REGISTER AS A VAT PERSON AND
ITS TOTAL ANNUAL SALES OF FLOWERS DO NOT EXCEED PHP 1,919,500
ANSWER: D
40.XYZ CORPORATION IS THE OWNER-OPERATOR OF MOVIE HOUSES IN CAVITE. DURING THE
YEAR 2015, IT RECEIVED A TOTAL GROSS RECEIPTS OF PHP 20 MILLION FROM THE
OPERATION OF MOVIES. IT DID NOT REGISTER AS A VAT PERSON. WHICH STATEMENT BELOW
IS CORRECT?
A.

XYZ CORPORATION IS EXEMPT FROM THE 12% VAT, BUT LIABLE FOR THE 20%
LOCAL GOVERNMENT CODE.
B. XYZ CORPORATION IS BOTH LIABLE FOR THE 12% VAT AND 20% AMUSEMENT TAX ON
ADMISSIONS.
C. XYZ CORPORATION IS BOTH EXEMPT FROM THE 12% VAT AND 20% AMUSEMENT TAX
ON ADMISSIONS.
D. XYZ CORPORATION IS LIABLE FOR THE 12% VAT, BUT EXEMPT FROM 20% AMUSEMENT
TAX ON ADMISSIONS.
AMUSEMENT TAX ON ADMISSIONS UNDER THE

ANSWER: A
41.UNDER THE VAT SYSTEM, THERE IS NO CASCADING BECAUSE THE TAX ITSELF IS NOT AGAIN
BEING TAXED. HOWEVER, IN DETERMINING THE TAX BASE ON SALE OF TAXABLE GOODS
UNDER THE VAT SYSTEM :
A. THE PROFESSIONAL TAX PAID BY THE PROFESSIONAL IS INCLUDED IN GROSS RECEIPTS.
B. THE OTHER PERCENTAGE TAX PAID BY THE TAXPAYER IS INCLUDED IN GROSS SELLING

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
PRICE.
D.

THE EXCISE TAX PAID BY THE TAX PAYER BEFORE WITHDRAWAL OF THE GOODS FROM THE

PLACE OF PRODUCTION OF FROM CUSTOMS CUSTODY IS INCLUDED IN THE GROSS SELLING

PRICE.
D.

THE DOCUMENTARY STAMP TAX PAID BY THE TAXPAYER IS INCLUDED IN THE GROSS

SELLING PRICE OR GROSS RECEIPTS.

ANSWER: C
42.TO FRANCHISE GRANTEES OF RADIO OR TELEVISION, THE VAT-REGISTRATION SHALL BE
A. REVOCABLE IN 3 YEARS
B. IRREVOCABLE IN 3 YEARS
C. REVOCABLE IN 1 YEAR
D. IRREVOCABLE PERPETUALLY
ANSWER: D
43.WHICH IS NOT VATABLE AS A SEPARATE ENTITY?
A. A BRANCH
B. A SUBSIDIARY COMPANY
C. A SPOUSE
D. A PARENT COMPANY
ANSWER: A
44.EXCEPT FOR ONE TRANSACTION, THE REST ARE EXEMPT FROM VAT. WHICH IS THE VAT
TAXABLE?
A. SALE OF CHICKEN BY A RESTAURANT OWNER WHO DID NOT REGISTER AS A VAT PERSON
AND WHOSE GROSS ANNUAL SALES IS P1.2 M.
B. SALE OF COPRA BY A COPRA DEALER TO A CCONUT OIL MANUFACTURER WHO DID NIT
REGISTER AS A VAT PERSON AND WHOSE GROSS ANNUAL SALES IS P 5 MILLION.
C. GROSS RECEIPTS OF A CPA DURING THE YEAR AMOUNTED TO P 1 MILLION ; THE CPA
REGISTERED AS VAT PERAON IN JANUARY 2013, BEFORE PRACTICING HIS PROFESSION.
D. SALES OF A BOOK STORE DURING THE YEAR AMOUBTED TO 10 M; IT DID NOT REGISTER
AS VAT PERSON WITH THE BIR.
ANSWER: C
45.A TAXPAYER HAS THE FF. TRANSACTIONS FOR THE QUARTER:
TOTAL SALES/RECEIPTS, NET OF VAT
P3,600,000
TOTAK PURCHASES, NET OF VAT
P950,000
WHAT WILL THE TAXPAYER SUBMIT TO THE BIR?
A. SUMMARY LIST OF SALES ONLY
B. SUMMARY LIST OF PURCHASES ONLY
C. BOTH SUMMARY LIST OF SALES AND SUMMARY LIST OF PURCHASES
D. NEITHER SUMMARY LIST OS SALES AND PURCHASES
ANSWER: C

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
46.A VAT REGISTERED PERSON IS ALSO ENGAGED IN VAT EXEMPT TRANSACTIONS. DURING A
PARTICULAR MONTH, HE HAS THE FF. TRANSACTIONS (VAT EXCLUDED) :
PURCHASES OF GOODS FOR VAT SALES P500,000
PURCHASES OF SUPPLIES FOR BOTH VAT AND NONVAT SALES P800,000
VAT SALES AMOUNT TO P1000,000 AND NON VAT SALES AMOUNT TO P500,000. IF YPU
ARE ASKED TO COMPUTE FOR THE INPUT TAXES CREDITABLE AGAINST THE OUTPUT TAX, HOW
MUCH WILL IT BE?
A. P156,000
B. P124,000
C. P60,000
D. NONE OF THE ABOVE
ANSWER: B
47.FRAY PUBLISHERS, A VAT BUSINESS, REGULARLY PUBLISHED THE FOLLOWING DURING THE
MONTH WITH THEIR CORRESPONDING COST OF PRODUCTION :
SILVER CREY DAILY NEWS
COLLEGE TEXTBOOKS AND REFERENCES
PROPERTY ADS
BINDERY SERVICES
PASSBOOK AND CALLING CARDS

5,800,000
3,980,000
2,000,000
1,500,000
500,000

HOW MUCH IS THE OUTPUT VAT IF FRAY SOLD THE PRODUCTS AND SERVICES AT A 30%
GROSS PROFIT BASED ON COST?
A. 500000
B. 480000
C. 420000
D. 400000
ANSWER: B
48.ALL OF THE FOLLOWING, EXCEPT ONE, ARE VAT EXEMPT:
A. SALE OF CARGO VESSELS
B. SALE OF FEEDS FOR ZOO ANIMALS
C. IMPORTATION OF DIRECT FARM INPUTS BY AGRICULTURAL COOPERATIVE REGISTERED WITH
CDA
D. IMPORTATION OF LIFE SAVING EQUIPMENT.
ANSWER : B
49.WHICH OF THE FOLLOWING SERVICES MAY BE SUBJECT TO VAT?
A. HOSPITAL SERVICES
B. TESDA-REGISTERED EDUCATIONAL SERVICES
C. PROFESSIONAL SERVICES
D. EMPLOYEE'S SERVICES
ANSWER: C

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
50.IF THE COMMISSIONER FULLY OR PARTIALLY DENIES THE APPLICATION FOR VAT REFUND OR
ISSUANCE OF TAX CREDIT CERTIFICATE ON THE EXPIRATION OF THE 120-DAY PERIOD, THE
TAXPAYER MAY APPEAL TO THE COURT OF TAX APPEALS WITHIN:
A. 60 DAYS FROM THE RECEIPT OF THE DENIAL
B. 30 DAYS FROM THE DATE OF SUBMISSION OF COMPLETE DOCUMENTS
C. 60 DAYS FROM THE DATE OF SUBMISSION OF COMPLETE DOCUMENTS
D. 30 DAYS FROM THE RECEIPT OF THE DENIAL
ANSWER: D
51.STATEMENT 1: ALEX IMPORTED P50,000 WORTH OF PERFUMES. THE PRODUCTS WILL BE
USED FOR THE BUSINESS. THE SAID BUSINESS IS NON-VAT REGISTERED HENCE THE VAT ON
IMPORTATION IS EXEMPT.
STATEMENT 2: IODIZED SALT IS CONSIDERED A PRODUCT ON ITS ORIGINAL STATE.
A.

STATEMENT 1: TRUE STATEMENT 2: TRUE

STATEMENT 1: TRUE STATEMENT 2:FALSE
C. STATEMENT 1: FALSE STATEMENT 2: TRUE
D. STATEMENT 1: FALSE STATEMENT 2: FALSE
B.

ANSWER: D
52.THE FOLLOWING ARE EXAMPLES OF ACTS OF PRESERVATION EXCEPT?
A. FREEZING
B. BAKING
C. SALTING
D. NONE OF THE ABOVE
ANSWER: B
53.MS. MOYANO, A REAL PROPERTY DEALER, SOLD A COMMERCIAL LOT IN FEBRUARY 2015.
THE FOLLOWING RELATES TO THE SALE:
APPRAISAL VALUE P4,500,000
ZONAL VALUE 4,000,000
ASSESSED VALUE 2,500,000
SELLING PRICE 3,800,000
HOW MUCH IS THE OUTPUT VAT?
A. P540,000
B. P480,000
C. P456,000
D. P300,000
ANSWER: B
54.MAE MAE, A VAT REGISTERED TAXPAYER, HAD A FOLLOWING SALES IN HER STORE:
SALES OF MEAT CUTS
400,000
SALES OF HOTDOGS
100,000
CUP NOODLES
10,000

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
CANNED SARDINES AND BEANS
40,000
HOW MUCH OF THE SALES ARE SUBJECT TO VAT?
A. P500,000
B. P540,000
C. P110,000
D. P150,000
ANSWER: D
55.FRANCHISE GRANTEES OF CITY GAS AND WATER UTILITIES ARE SUBJECT TO FRANCHISE TAX OF
A. 2%
B. 3%
C. 4%
D. 5%
ANSWER: A
56.ONE OF THE FOLLOWING IS NOT A MAJOR BUSINESS INTERNAL REVENUE TAX IN THE TAX
CODE
A. INCOME TAX
B. VAT
C. EXCISE TAX
D. PERCENTAGE TAX
ANSWER: A
57.IT REFERS TO CONSUMPTION OR PURCHASES OF NON-RESIDENTS.
A. DOMESTIC CONSUMPTION
B. FOREIGN CONSUMPTION
C. LOCAL CONSUMPTION
D. RESIDENT CONSUMPTION
ANSWER: B
58.WHICH IS A TAX UPON THE USAGE OF INCOME?
A. SAVINGS TAX
B. INVESTMENT TAX
C. CONSUMPTION TAX
D. BUSINESS TAX
ANSWER: C
59.WHICH OF THE FOLLOWING IS NOT ALLOWED FOR A TAX REFUND OR ISSUANCE OF TAX
CREDIT CERTIFICATE?
A. ZERO RATED SALES
B. EFFECTIVELY ZERO RATED VAT
C. UNUSED INPUT VAT ON ORDINARY PURCHASES
D. CANCELLATION OF VAT REGISTRATION
ANSWER: C
60.STATEMENT 1: IF THE VAT INVOICE AMOUNT DOES NOT INDICATE SEPARATELY THE VAT, THE
SALE IS NOT COVERED BY VAT.

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
STATEMENT 2: THE AMOUNT OF VAT IS DETERMINED BY DIVIDING THE VAT SALES INVOICE BY
9.3333
A. ONLY STATEMENT 1 IS CORRECT
B. ONLY STATEMENT 2 IS CORRECT
C. BOTH STATEMENTS ARE CORRECT
D. BOTH STATEMENTS ARE INCORRECT
ANSWER: B
61.WHICH IS NOT A CHARACTERISTIC OF PHILIPPINE VAT?
A. IT IS AN INDIRECT TAX
B. IT IS A TRANSPARENT FORM OF SALES TAX
C. IT IS A NOT SUBSTITUTE FOR SALES TAX, HOTEL TAX, CONTRACT TAX AND ENTERTAINMENT
TAX.
D. IT ADOPTS TAX INCLUSIVE METHOD
ANSWER: C
62.WHEN IS THE TIME TO FILE A MONTHLY RETURN?
A. RETURN NOT LATER THAN THE 20TH DAY FOLLOWING THE END OF EACH MONTH
B. RETURN NOT LATER THAN THE 25TH DAY FOLLOWING THE END OF EACH MONTH
C. RETURN OF THE AMOUNT OF HIS QUARTERLY GROSS SALES OR RECEIPTS WITHIN 25 DAYS
FOLLOWING THE CLOSE IF THE TAXABLE QUARTER.
D. RETURN OF THE AMOUNT OF HIS QUARTERLY GROSS SALES OR RECEIPTS WITHIN 30DAYS
FOLLOWING THE CLOSE IF THE TAXABLE QUARTER.
ANSWER: A
63.STATEMENT 1: PERSON WITH DISABILITIES ARE EXEMPTED FROM 12% VAT ASIDE FROM
20% DISCOUNT.
STATEMENT 2: SENIOR CITIZENS ARE GRANTED WITH BENEFITS AND PRIVILEGES THAT RANGE
FROM 20% DISCOUNT AND VAT EXEMPTION.
A.

STATEMENT 1 IS TRUE.
STATEMENT 2 IS TRUE.
C. BOTH STATEMENTS ARE TRUE.
D. BOTH STATEMENTS ARE FALSE.
B.

ANSWER: C
64.WAB CONSIGNED GOODS TO SM ON MAY 15, 2016. THE SELLING PRICE OF THE GOODS AS
OF AUGUST 30, 2016 IS P130,000. THE CONSIGNED GOODS REMAIN UNSOLD AFTER 60
DAYS AND ARE NOT RETRIEVED BY WAB. THE COST OF THE GOODS IS P100,000. HOW
MUCH IS THE VAT ALLOWED FOR VAT REPORTING PURPOSES?
A. 0
B. 12,000
C. 15,600
D. 27,600
ANSWER: C

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C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
65.IT REFERS TO CONSUMMATION OF PURCHASES OF GOODS AND SERVICES BY A VAT
REGISTERED BUYER FROM VAT REGISTERED SELLER.
A. DOMESTIC PURCHASES
B. NON-RESIDENT PURCHASES
C. FOREIGN PURCHASES
D. RESIDENT PURCHASES
ANSWER: A
66.IT REFERS TO PURCHASE OF GOODS OR SERVICES FROM FOREIGN COUNTRY BROUGHT IN THE
PH EITHER FOR PERSONAL OR BUSINESS USE
A. EXPORTATION
B. IMPORTATION
C. CONSUMPTION
D. EXEMPTION
ANSWER: B
67.WHICH IS NOT A CONDITION FOR EXEMPTION OF EDUCATIONAL SERVICES?
A. DUE ACCREDITATION BY DEPED
B. EDUCATIONAL SERVICE RENDERED BY PRIVATE ORGANIZATIONS
C. DUE ACCREDITATION BY CHED
D. DUE ACCREDITATION BY TESDA

ANSWER: B
68.TRUE OR FALSE
A DEEMED SALE TRANSACTION IS NOT ACTUAL SALE BUT BY LEGAL FICTION. THIS IS
ASSUMED OR CONSIDERED SALE DUE TO THE CONSUMPTION OR REGULAR DISPOSAL OF
GOODS/PROPERTIES BY A

VAT-REGISTERED SELLER.

ANSWER: FALSE

69.DAC COMPANY SHOWS YOU THE FF:

DATE OF SALE - JUNE 2, 2011
CONSIDERATION IN THE DEED OF SALE - P5,000,000
FMV IN THE ASSESSMENT ROLLS - 4,800,000
ZONAL VALUE - 5,200,000
PAYMENTS ON THE CONSIDERATION:
JUNE 2, 2014 - 1,000,000
JUNE 2, 2015 - 2,000,000
JUNE 2, 2016 - 2,000,000
WHAT WILL BE USED AS THE TAXABLE BASE FOR THE SALE?
A. 5, 200, 000
B. 4,800,000

4-DAC
C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
C.
D.

5,000,000
NONE

ANSWER: A
70.ST. DOLLA HOSPITAL REPORTED THE FF. MEDICAL BILLS OF ATTY. T. A. XAVIER BEFORE
VAT:
ROOM ACCOMMODATION P500,000
MEDICINE USED IN OPERATION AND DIALYSIS 400,000
LABORATORY SERVICES 600,000
OPERATING SERVICES 300,000
DOCTORS PROFESSIONAL FEES, VAT VISITING SPECIALIST 800,000
TOTAL MEDICAL BILLS P2,600, 000
HOW MUCH IS THE AMOUNT OF OUTPUT VAT?
A. 312, 000
B. 204, 000
C. 96, 000
D. 108, 000
ANSWER: C
71.WHICH OF THE FOLLOWING IS INCORRECT: SALE OF RESIDENTIAL HOUSE AND LOT BY AN
OFFICIAL OF A DOMESTIC CORPORATION TO ANOTHER OFFICIAL IN THE SAME CORPORATION

P2.5MILLION IN 2013 IS:

EXEMPT FROM VAT BECAUSE THE GROSS SALES DO NOT EXCEED P2.5MILLION.
B. EXEMPT FROM VAT BECAUSE THE PROPERTY SOLD IS A CAPITAL ASSET, REGARDLESS OF
THE GROSS SELLING PRICE.
C. EXEMPT FROM VAT BECAUSE THE SELLER IS NOT A PERSON ENGAGED IN REAL ESTATE
BUSINESS.
D. TAXABLE AT 12% VAT OUTPUT TAX ON THE GROSS SELLING PRICE OF P2.5MILLION
WHICH STATEMENT ABOVE IS
FOR A CONSIDERATION OF
A.

ANSWER: B
72.EXCEPT FOR ONE TRANSACTION, THE REST ARE EXEMPT FROM VAT. WHICH ONE IS VAT
TAXABLE?
A. SALES OF CHICKEN BY A RESTAURANT OWNER WHO DID NOT REGISTER AS A VAT PERSON
AND WHOSE GROSS ANNUAL SALES IS P1.2 MILLION.
B. SALES OF COPRA BY A COPRA DEALER TO A COCONUT OIL MANUFACTURER WHO DID NOT
REGISTER A VAT PERSON AND WHOSE GROSS ANNUAL SALES IS P5 MILLION.
C. GROSS RECEIPTS OF A CPA DURING THE YEAR AMOUNTED TO P1 MILLION; THE CPA
REGISTERED AS A VAT PERSON IN JANUARY 2013, BEFORE PRACTICING HIS PROFESSION.
D. SALES OF A BOOK STORE DURING THE YEAR AMOUNTED TO P10 MILLION; IT DID NOT
REGISTER AS A VAT PERSON WITH THE BIR.
ANSWER: C

4-DAC
C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
73.THE VAT ON GOODS
A. IS A SELLING EXPENSE OF THE TRADER
B. IS IMPOSED ON GOODS FOR DOMESTIC CONSUMPTION
C. IT IS NOT BASED ON NET SALES
D. MAYBE DUE EVEN IF THERE IS NO ACTUAL SALE OF THE GOODS
ANSWER: D
74.AM OPERATES CONVENIENCE STORE, FROM WHICH THE GROSS RECEIPTS FROM SALES, AND
PAYMENTS OF PURCHASES FROM VAT-REGISTERED SUPPLIES, WERE AS FOLLOWS:
SALES OF PROCESSED FOOD ITEMS
SALES OF NON-FOOD ITEMS
PURCHASES OF PROCESSED FOOD ITEMS
PURCHASES OF NON-FOOD ITEMS
SALARIES OF HELPERS

280,
220,
100,
80,
48, 000

000
000
000
000

IF A OPTED TO BE REGISTERED UNDER THE VAT SCHEME, THE VAT PAYABLE IS:
A. 15, 000
B. 32, 000
C. 38, 400
D. 27, 200
75.I. SALE AND IMPORTATION OF FUEL, GOODS AND SUPPLIES BY PERSONS ENGAGED IN
INTERNATIONAL SHIPPING OR AIR TRANSPORT OPERATIONS IS A VAT EXEMPT TRANSACTION.
II. SALE OF GROUND BEEF BY A VAT-REGISTERED PERSON IS SUBJECT TO VAT.
a. BOTH STATEMENTS ARE TRUE.
b. BOTH STATEMENTS ARE FALSE.
c. ONLY STATEMENT I IS TRUE
d. ONLY STATEMENT II IS FALSE.
ANSWER: B
76.A TAXPAYER WAS REGISTERED UNDER VAT SYSTEM IN THE SECOND MONTH OF THE 3RD
CALENDAR QUARTER. HIS CERTIFICATE OF REGISTRATION SHOWS THE EFFECTIVE DATE AS
SEPTEMBER 1. TO CONFORM WITH VAT REQUIREMENT WHAT WILL HE FILE INITIALLY?
A. MONTHLY VAT DECLARATION ON OR BEFORE AUGUST 20
B. MONTHLY VAT DECLARATION ON OR BEFORE SEPTEMBER 20
C. QUARTERLY VAT RETURN ON OR BEFORE OCTOBER 20
D. QUARTERLY VAT RETURN ON OR BEFORE OCTOBER 25
ANSWER: D
77.STATEMENT 1: SEA VESSELS ARE SUBJECT TO VAT ON CARRIAGE OF PASSENGERS
STATEMENT 2: AIRPLANES ARE SUBJECT TO VAT ON CARRIAGE OF GOODS AND PASSENGERS
a. YES, NO
b. NO, YES
c. YES, YES
d. NO, NO
ANSWER: C

4-DAC
C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
78.NAOMI, A JAPANESE RESIDING IN THE PHILIPPINES BOUGHT GARMENTS FROM CUA
CORPORATION, A DOMESTIC CORPORATION, AND EXPORTED THE SAME TO JAPAN. TOTAL
VALUE OF EXPORT IS P100,000. OUTPUT VAT DUE ON THE TRANSACTION IS
A. P10,000
B. P5,000
C. NONE, BECAUSE 0% APPLIES
D. NONE, BECAUSE THE SALE IS EXEMPT FROM VAT
ANSWER: D
79.WHICH OF THE FOLLOWING IS CORRECT?
STATEMENT 1: A PERSON WHO OPERATED AND MAINTAINS AN OFFICE OF ESTABLISHMENT
AND SELLS MERCHANDISE ON A COMMISSION BASIS UNDER THE SO CALLED DIRECT SELLING
METHOD OF MARKETING DOES NOT CONSTITUTE A BRANCH
STATEMENT 2 OVERSEAS WORKERS ARE NOT EXEMPTED FROM REGISTRATION FEE
A. TRUE; TRUE
B. TRUE; FALSE
C. FALSE; TRUE
D. FALSE; FALSE

ANSWER: B
80.WHEN DID VAT BECOME EFFECTIVE IN THE PHILIPPINES?
a. JANUARY 1, 1988
b. DECEMBER 31, 1978
c. JANUARY 1, 1978
d. DECEMBER 31, 1988
ANSWER: A
81.WHICH OF THE FOLLOWING IS CORRECT?
STATEMENT 1: IF A VAT-REGISTERED PERSON BOUGHT THE GOODS FROM A VAT-REGISTERED
BUSINESS FOR PERSONAL USE, THE COST THEREOF, AND THE RELATED VAT (INPUT TAX)
SHOULD NOT BE RECORDED IN THE BOOKS OF ACCOUNTS.
STATEMENT 2: FOR TAX PURPOSES, CASUAL SALES ARE NOT SUBJECT TO BUSINESS TAX BUT
SUBJECT TO INCOME TAX.
A.
TRUE, TRUE
B.
TRUE. FALSE
C.
FALSE, TRUE
D.
FALSE, FALSE
ANSWER: A
82.WHICH OF THE FOLLOWING IS CORRECT?
STATEMENT 1: A BUSINESS SHALL RENEW ITS REGISTRATION ANNUALLY AT THE END OF
JANUARY.
STATEMENT 2: NONCOMPLIANCE TO BUSINESS REGISTRATION WOULD RENDER THE BUSINESS
ILLEGAL.
A.
TRUE, TRUE
B.
TRUE. FALSE
C.
FALSE, TRUE

4-DAC
C LASS SIZE: 41
TOTAL # OF QUESTIONS: 82
D.

FALSE, FALSE

ANSWER: C