PUP QUIZ No. 2 ACCO 30193 Strategic Tax Management 2nd Semester AY 2020 2021

PUP
QUIZ No. 2: ACCO 30193 Strategic Tax

Management
2nd Semester AY 2020-2021
May 19, 2021 (Wednesday) at 2pm to 6pm
Second Semester, AY 2020-2021
GENERAL INSTRUCTIONS:
1. Read the following questions carefully and choose the best answer for every item.
2. You are given sufficient time to accomplish this examination. Kindly submit your form within the
appropriate time. It is advisable that you save a screenshot of your answers as proof of your submission
in case any problem arises.
3. Cheating and any form of communication with your classmates is not tolerated and tantamount to
failing the test if proven.

Hi Ma Glyza, when you submit this form, the owner will be able to see your name and email address.
* Required
Last Name
Mamanao
First Name
Ma Glyza
3
Yr and Section *
BSMA 3-4
BSMA 3-2
BSMA 3-1P
If the company will start the operations of the new branch in year 8, what is the income
tax liability-payable to BIR of ABC in year 8? *
(10 Points)
• 550,000
• 525,000
• 497,000
• 532,000
• None of the above

5
A. Tax management should strive to enhance the firm’s strategy and should not cause
the firm to engage in tax-minimizing transactions illegally that deter it from its
strategic plan.
B. The management has to assess from time to time the change in tax environment to
see what has change and eventually adjust the strategy. *
(10 Points)
• TT
• FF
• TF
• FT
ABC Corp, DC, has the following data:
Year 7, the corp has no operations and incurred a net loss of 100,000 (OPEX is
200,000). The company is planning to set a new branch in year 8 where the projected
gross income is 3M and OPEX is 500,000 only. RCIT is projected to decrease from 30%
to 25% in year 8 WHILE MCIT is projected to decrease from 2% to 1% in year 8. The
company has option to start the new project earlier in year 7 instead of Year 8.
Consider the impact of MCIT, Excess MCIT and other provisions of the Tax Code.
What is the income tax liability of ABC Corp in year 6 before the operation of new
branch? *
(10 Points)
• Zero
• 120,000
• 10,000
• 4,000
Data are as follows: Company plans to invest into a new equipment: Cost is 100,000;
useful life is 5 years; salvage value is zero; Expected cash inflows before tax is 40,000.
Assuming tax rate is 40%. Discount rate is 12% (PVF is 3.61). Should the company
invest into the new machine if the basis is the NPV? *
(10 Points)
• Yes, because of NPV of 25,600-positive
• NO, because of negative NPV of 25,600
• Yes, because of NPV of 15,520- positive
• Yes, with NPV of 73,280 positive
Two options: A= Hire one manager paying net cash of 1,000,000 (net of SSS, Pagibig
and Philhealth contributions of employee of 100,000); Employer’s contributions is
equal to 80% of employee’s contributions and taxable fringe benefits with monetary
value of 100,000. Option B= Hire two supervisory level persons; total salary is
1,100,000, gross of deductions from SSS, pagibig and philhealth. Employees
contributions to SSS, pagibig and Philhealth totaled 100,000 (50% of total
contributions to SSS, Pagibig and Philhealth) and taxable fringe benefits with monetary
value of 100,000. What is the net advantage of hiring one manager? *
(10 Points)
• No advantage
• 20,000 advantage
• Same, no difference
• 30,000

9
A. . Investors and shareholders are able to have a voice in the management only
through choosing the best directors and management of the company by personal
selection.
B. In a corporate setting, it can control the timing of income to its shareholders. For
example, a corporation normally can choose not to pay dividends. *
(10 Points)
• TT
• FF
• TF
• FT
10
Data are as follows: Company plans to invest into a new equipment and financing it by
obtaining a bank loan at interest rate of 10% per annum – 5 year term- (interest is
deductible): Cost is 100,000; useful life is 5 years; salvage value is zero; Expected cash
inflows before tax is 40,000. Assuming tax rate is 40%. Discount rate is 12% (PVF is
3.61). NPV is ? *
(10 Points)
• Negative 6,140
• Negative 29,960
• Positive 9,820
• Positive 29,960
11
A.When the excise tax due on excisable articles has not been paid causing unpaid taxes
of 10M, more than 3M, PAN shall be send to the Company to demand for payment of
unpaid taxes.
B.The decision of the CTA En Banc can be questioned before the Supreme Court by
filing a Petition for Review within 15 days from receipt of the decision. *
(10 Points)
• TT
• FF
• TF
• FT
12
The company had expected to incur R&D cost of 1,000,000. IN 2022 and 2023, the
company has projected taxable net income (before R&D cost) of 1,200,000 and
300,000, respectively. If the company expensed out immediately the R&D cost in 2022,
which of the following is not incorrect? (Total Assets is 50M) *
(10 Points)
• Income tax due in 2022 will 50,000
• If the R&D cost is amortized over 5 years, income tax due in 2022 will be 200,000
• Income tax due in 2023 will 40,000
• If the R&D cost is amortized over 5 years, year 2023 will be subject to MCIt ; MCIT higher than RCIT
13
Data are as follows: Company plans to invest into a new equipment: Cost is 100,000;
useful life is 5 years; salvage value is zero; Expected cash inflows before tax is 40,000.
Assuming tax rate is 40%. Discount rate is 12% (PVF is 3.61). Option 1: issuance of
shares with dividend rate of 10%. Option 2: bank loan with interest rate of 10%. Option
1 has higher (lower) “net income after tax” per Income Statement by_______ – in year 1?
*
(10 Points)
• Same –no difference
• 6, 000 lower
• 4,000 lower
• 4,000 higher

Submit
This content is created by the owner of the form. The data you submit will be sent to the form owner. Microsoft is not responsible
for the privacy or security practices of its customers, including those of this form owner. Never give out your password.
Powered by Microsoft Forms | Privacy and cookies | Terms of use

PUP QUIZ No. 2 ACCO 30193 Strategic Tax Management 2nd Semester AY 2020 2021

Uploaded by

Copyright:

Available Formats

PUP QUIZ No. 2 ACCO 30193 Strategic Tax Management 2nd Semester AY 2020 2021

Uploaded by

Document Information

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

PUP QUIZ No. 2 ACCO 30193 Strategic Tax Management 2nd Semester AY 2020 2021

Uploaded by

Copyright:

Available Formats

PUP

QUIZ No. 2: ACCO 30193 Strategic Tax

• None of the above

ABC Corp, DC, has the following data:

• Yes, because of NPV of 25,600-positive

• NO, because of negative NPV of 25,600

• Yes, because of NPV of 15,520- positive

• Yes, with NPV of 73,280 positive

• None of the above

• None of the above

• None of the above

• Income tax due in 2022 will 50,000

• Income tax due in 2023 will 40,000

• None of the above

• Same –no difference

• None of the above

Powered by Microsoft Forms | Privacy and cookies | Terms of use

You might also like