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Chapter 2 Problems and Solutions

This document contains multiple word problems involving calculating VAT on importations. The problems provide details on items imported and any additional costs incurred. They ask to calculate the total tax base and VAT amount based on the information given, with the answer provided as a single number without commas or currency symbols. Sample calculations are shown for reference.

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Estonilo, Monica Benesa
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260 views4 pages

Chapter 2 Problems and Solutions

This document contains multiple word problems involving calculating VAT on importations. The problems provide details on items imported and any additional costs incurred. They ask to calculate the total tax base and VAT amount based on the information given, with the answer provided as a single number without commas or currency symbols. Sample calculations are shown for reference.

Uploaded by

Estonilo, Monica Benesa
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Chapter 2 Problems and Solutions

Joy, Inc. purchased the following from abroad: Sea shells and coral decors – P650,000; Fresh
tuna and salmon – P250,000. What is the total amount of taxable importation? (answer must
all be numbers, no comma, no peso sign and no decimals)

650000 (just the sea shells and coral decors as these are nonfood items)

Love imported various personal and household effects with a value aggregating
P500,000. P420,000 of these was subject to 8% customs duty by the BOC. What is the vat on
importation? (answer must all be numbers, no comma, no peso sign and no decimals)

54432 Importations subjected to customs duty 420000

Add: Customs duty (420,000 x 8%) 33600

Total tax base 453600

X VAT rate 12%

VAT amount 54432

A bookstore company imported the following items (all excluding VAT): Books – P700,000;
professional instruments – P400,000; School supplies – P800,000. What is the VAT on
importation? (answer must all be numbers, no peso sign, no comma & no decimals)

144000 Professional instruments 400000

Add: School supplies 800000

Total tax base 1200000

X VAT rate 12%

VAT amount 144000

Mr. Peace, a VAT-registered food retailer, imported the following from China: Fruits – P750,000;
Vegetables – P540,000; Frozen meat -P150,000; Marinated milkfish – P300,000. What is the VAT
on importation? (answer must all be numbers, no peso sign, no comma & no decimals)

36000 (just the marinated milkfish – 300,000 x 12% = 36000)


Ms. Amiable imported various merchandise from abroad. The importation was invoiced at
$5,000. She also incurred the following costs of importation: Insurance – P4,000; Freight –
P15,000; Wharfage fee – P4,000; Arrastre charge – P7,000; Brokerage fee – P8,000; Facilitation
fee – P5,000; Customs duties P24,000 and excise tax – P18,000. The applicable exchange rate
was P51.00: $1. What is the VAT on importation? (answer must all be numbers, no peso sign,
no comma & no decimals)

40200 Invoice amount in pesos ($5000 x P51) 255000

+ Insurance 4000

+Freight 15000

+Wharfage fee 4000

+Arrastre charge 7000

+Brokerage fee 8000

+Customs duties 24000

+Excise tax 18000

Total tax base 335,000

X VAT rate 12%

VAT amount 40200

Facilitation fee of P5,000 is not included as it is an illegal payment.

Golden Arches is licensed franchisee of Mcdo, a non-resident franchisor. If Golden paid


P7,500,000 royalties (ex-VAT), VAT is (answer must all be numbers, no peso sign, no comma
& no decimals)

900000 (7500000 x 12%)


Pacman imported a brand-new Jaguar, 2018 model for his wife. Total landed costs is P15M,
exclusive of P3M custom duties, P2M excise tax & P1M facilitation fee. VAT payable is how
much? (answer must all be numbers, no comma, no peso sign & no decimals)

2400000 Total landed cost excluding other charges 15000000

+Customs duties 3000000

+Excise tax 2000000

Total tax base 20000000

X VAT rate 12%

VAT amount 2400000

Facilitation fee of P1M is not included as it is an illegal payment.

World Power Corp. imported an article from Japan. The invoice value was $7,000 ($1=P50). The
following additional costs were incurred: Insurance – P15,000; Freight – P10,000; Postage –
P5,000; Wharfage – P7,000; Arrastre charges – P8,000; Brokerage – P25,000; Facilitation – P3,000;
Customs duty – P50,000; Excise tax – P30,000. The company likewise spent P50,000 for trucking
fee from customs warehouse to its warehouse in Quezon City. The career is a VAT-registered
entity. VAT on importation is how much? (answer must all be numbers, no peso sign, no
comma & no decimals)

60000 Invoice value in pesos ($7000 x P50) 350000

Insurance 15000

Freight 10000

Postage 5000

Wharfage 7000

Arrastre charges 8000

Brokerage 25000

Customs duty 50000

Excise tax 30000

Total tax base 500000

X VAT rate 12%

VAT amount 60000


Facilitation fee of P3,000 is not included as it is an illegal payment. Trucking fee of
P50,000 from customs bonded warehouse to company’s warehouse is no longer part of the
tax base.

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