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Tax 2 Sample Problem Solving

The document discusses various business transactions and calculates the tax liability in each case. It provides examples of: 1) Regular transactions with tax liability of PHP 392,640 consisting of VAT on purchases and sales. 2) An export sale that is VAT zero-rated. 3) A sale of a car subject to 12% VAT but a sale of a van is VAT exempt. 4) Tax liability of PHP 102,000 from export and local sales along with input VAT. 5) Calculation of input VAT, standard input VAT, and VAT payable for sales to private and government entities. 6) Breakdown of input tax attributable to different taxed sales.

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Alberto Nichols
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795 views2 pages

Tax 2 Sample Problem Solving

The document discusses various business transactions and calculates the tax liability in each case. It provides examples of: 1) Regular transactions with tax liability of PHP 392,640 consisting of VAT on purchases and sales. 2) An export sale that is VAT zero-rated. 3) A sale of a car subject to 12% VAT but a sale of a van is VAT exempt. 4) Tax liability of PHP 102,000 from export and local sales along with input VAT. 5) Calculation of input VAT, standard input VAT, and VAT payable for sales to private and government entities. 6) Breakdown of input tax attributable to different taxed sales.

Uploaded by

Alberto Nichols
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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PROBLEM SOLVING ON BUSINESS TRANSACTIONS

1 Amount of tax liability Tax liability


Regular transactions subject to and exclusive of
VAT 168,000.00 1400000x0.12
(1344000/1.12)x0.1
Purchases inclusive of VAT (on regular sale) 144,000.00 2
Purchases inclusive of VAT (on zero-rated sales) 80,640.00 672000x0.12
Total amount of tax liability 392,640.00

2 VAT for Stormy Company is zero since it is a foreign denominated sale like an export
sale when the TV and refrigerator is sold to an OFW, a nonresident.

3 The VAT is P72,0000 from the sale of 1-unit of 4-door sedan car (P600,00x12%). The 1
unit of 15-seater van is not VATable since it is a foreign currency denominated sale.

4 Data Tax liability


Since it is VAT-exempt
Export Sale 0.00 transaction
Local Sales 60,000.00 It is taxable P60,000x12%
Purchases related to sales, inclusive of VAT
Cannot claim since it is VAT-
On export sale 0.00 exempt
On local sale 42,000.00 (392,000/1.12)x0.12
Total Tax Liability 102,000.00

5
Sale to private entities subject to 12%
VAT 1,000,000.00
Sale to government 500,000.00
Purchases during the quarter applied to
all sales 300,000.00
Purchases from VAT-registered persons applicable
to sale to government/quarter 200,000.00
Purchase during the quarter applied to sales to
private entities 400,000.00

a. Standard input VAT 120,000.00 1000000x12%


b. Actual Input tax on sale on government 25,000.00 500000x5%
c. Input tax chargeable to cost or expense 35,000.00 300,000x12%+200,000/1112%x12%
d. VAT payable for the quarter 48,000.00 400000x12%

6
1. Input tax attributable to sales subject to
12% 25,000.00 5000+20000
2. Input tax attributable to zero-rated sales 3,000.00
3. Input tax attributable to VAT-exempt sales 2,000.00
4. Input tax attributable to government sales 4,000.00

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