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    Created by JENRIQ: Question Text

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    Florence Rose Arroyo Romano
    This document contains 10 multiple choice questions about taxation in the Philippines. The questions cover topics such as compensation income, separation pay, fringe benefits, leasehold improvements, and tax treatment of various types of income and benefits. Answer options consisting of letters a through d are provided for each question.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd

    Created by JENRIQ: Question Text

    Uploaded by

    Florence Rose Arroyo Romano
    1K views6 pages
    This document contains 10 multiple choice questions about taxation in the Philippines. The questions cover topics such as compensation income, separation pay, fringe benefits, leasehold improvements, and tax treatment of various types of income and benefits. Answer options consisting of letters a through d are provided for each question.

    Original Title

    MQ1-PHIL-TAX-SYSTEM (1)

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    This document contains 10 multiple choice questions about taxation in the Philippines. The questions cover topics such as compensation income, separation pay, fringe benefits, leasehold improvements, and tax treatment of various types of income and benefits. Answer options consisting of letters a through d are provided for each question.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    1K views6 pages

    Created by JENRIQ: Question Text

    Uploaded by

    Florence Rose Arroyo Romano
    This document contains 10 multiple choice questions about taxation in the Philippines. The questions cover topics such as compensation income, separation pay, fringe benefits, leasehold improvements, and tax treatment of various types of income and benefits. Answer options consisting of letters a through d are provided for each question.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 6

    Created by JENRIQ

    Question 1
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    Statement I. Compensation income includes salary, honoraria, allowances,


    separation pay, and retirement pay.
    Statement II. Representation and travelling allowances that are fixed in amount are
    not taxable.

    Select one:
    a. Both statements are correct
    b. Only Statement mpensation income includes salary, honoraria, allowances,
    separation pay, and retirement pay is correct
    c. Only Statement Representation and travelling allowances that are fixed in amount are
    not taxable is correct
    d. Neither statement is correct

    Question 2
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    Statement I Separation pay may be taxable or tax-exempt


    Statement II Separation pay is not taxable if the separation is involuntary on the part of
    employee.

    Select one:
    a. Only Statement I is correct
    b. Neither statement is correct
    c. Both statements are correct
    d. Only Statement II is correct

    Question 3
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    The following situation may warrant that separation pay shall not be included in the gross
    taxable income, except

    Select one:
    a. Disability
    b. Reorganization of the company
    c. Bankruptcy of the company
    d. Employment
    Clear my choice

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    Question 4
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    Separation pay brought about by the following circumstances is non-taxable, except:

    Select one:
    a. Reorganization of the company due to merger
    b. Sickness
    c. Bankruptcy of the company
    d. Voluntary resignation

    Question 5
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    An ordinary asset may include the following, except:

    Select one:
    a. Real property of the taxpayer used in his/her trade or business
    b. Stock in trade of the taxpayer included as inventory at the end of the taxable year
    c. Personal property of the taxpayer used in his/her trade or business
    d. Depreciable properties used in the business
    Clear my choice

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    Question 6
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    A taxpayer received a basic salaray of P1,152,000 per year. At the end of taxable year, he
    also received 13th month pay which is equivalent to his one month basic salary. Is the 13th
    month pay of the taxpayer taxable?
    Answer I No, because 13th month pay is tax exempt and does not form part of the
    compensation income.
    Answer II Yes, because the 13th month pay he received already esceeded the P82,000
    threshold.

    Select one:
    a. No, because 13th month pay is tax exempt and does not form part of the compensation
    income is wrong:Yes, because the 13th month pay he received already esceeded the
    P82,000 threshold is correct
    b. No, because 13th month pay is tax exempt and does not form part of the compensation
    income is correct: Yes, because the 13th month pay he received already esceeded the
    P82,000 threshold is wrong
    c. Both answers are wrong
    d. Both answers are correct

    Question 7
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    Question text
    The grossed-up monetary value of fringe benefits shall be computed as:

    Select one:
    a. The monetary value of the fringe benefit shall be divided by 75% for non-resident alien
    not engaged in business or trade in the Philippines.
    b. For non-resident aliens engaged in business or trade in the Philippines, the monetary
    value shall be divided by 85%.
    c. The monetary value of employees in special economic zone shall be divided by 68%.
    d. The monetary value shall be divided by 75% for non-resident citizens.

    Question 8
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    Statement I Fringe benefits received by rank and file employees are not subject to fringe
    benefits tax, but included in the gross taxable income
    Statement II Fringe benefits granted to managerial employees are subject to fringe benefits
    tax and the employer withholds the amount of tax

    Select one:
    a. Both statements are correct
    b. Only Statement II is correct
    c. Only Statement I is correct
    d. Neither statement is correct
    Clear my choice

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    Question 9
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    Statement I Under outright method of recognizing income on leasehold improvement, the


    tax base is the cost or fair market value of the leasehold improvement whichever is higher.
    Statement II The fair market value of the leasehold improvement in the outright method
    means the value of the improvement at the time the contract becomes effective.

    Select one:
    a. Only Statement II is correct
    b. Both statements are correct
    c. Neither statement is correct
    d. Only Statement I is correct
    Clear my choice

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    Question 10
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    Statement I Fringe benefits received by an employee may either be subject to final tax or
    basic tax
    Statement II Fringe benefits received by supervisor or manager are nontaxable because of
    the complexities of functions attached to the position

    Select one:
    a. Neither statement is correct
    b. Both statements are correct
    c. Only Statement I is correct
    d. Only Statement II is correct

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