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Assignment - VAT and Exemptions From VAT - Answers

This document provides a multiple choice and problem solving assignment for a Tax 302 - Business and Transfer Taxes course. It includes 10 multiple choice questions testing knowledge of VAT exemptions and items subject to VAT. It also includes 7 problem solving questions requiring calculations and determinations of VAT application in various scenarios involving senior citizens, medical expenses, transportation, real estate, and food purchases. The student is asked to show their work and provide the final answers on separate sheets of paper.

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Mark Paul Ramos
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410 views3 pages

Assignment - VAT and Exemptions From VAT - Answers

This document provides a multiple choice and problem solving assignment for a Tax 302 - Business and Transfer Taxes course. It includes 10 multiple choice questions testing knowledge of VAT exemptions and items subject to VAT. It also includes 7 problem solving questions requiring calculations and determinations of VAT application in various scenarios involving senior citizens, medical expenses, transportation, real estate, and food purchases. The student is asked to show their work and provide the final answers on separate sheets of paper.

Uploaded by

Mark Paul Ramos
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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TAX 302 – Business and Transfer Taxes

ASSIGNMENT

NAME: __________________________________ SR Code: ____________________

Directions:
MULTIPLE CHOICE: Determine the correct answer from the options given. Provide your
answers in a separate sheet of paper.
PROBLEM SOLVING: Provide your solutions and final answer on a separate sheet of paper.

Part 1. MULTIPLE CHOICE

1. Which one is subject to VAT? Sale of


a. Contract grower
b. Piggery
c. Furniture
d. Balut

2. Which of the following is not exempt from VAT?


a. Importation in their original state of agricultural and marine food products
b. Importation of passenger or cargo vessel of more than 1,000 tons to be used by
the importer himself as operator thereof
c. Importation of personal and household effects belonging to residents of the
Philippines returning from abroad
d. Importation of non-food agricultural, marine and forest products in their original
state

3. All of the following except one are subject to VAT


a. Importation of radio and television equipment by broadcasting and television
stations
b. Sale of school textbooks
c. Lease of cold storage rooms in ice plants and cold storage
d. Sale of painting by middleman

4. Three of the following are exempt from value-added tax. Which is the exception?
a. Medical, dental and veterinary services
b. Sales rendered by person subject to percentage tax
c. Receipts from leasing of real properties
d. Exports sales by person who are not VAT registered

5. A 70-year old shall be entitled to VAT exemption privileges if


a. He is a resident of the Philippines
b. He is a resident of the United States
c. He is neither a resident of the Philippines nor of the United States
d. He is both a resident of the Philippines and of the United States
6. Which option is false? A 60-year old man who appears to be 45 years old only shall be
exempt from VAT upon showing of
a. His senior citizens identification card
b. Any valid identification card which bears his date of birth
c. Either option A or B
d. His maintenance medicine

7. The textbook “Transfer and Business Taxes” by Ampongan is subject to VAT on its
a. Sale in the Philippines
b. Printing in the Philippines
c. Publication in the Philippines
d. Exportation to Dubai

8. Lease of residential units shall not be exempt from VAT if


a. The monthly rental per unit does not exceed P15,000 and the aggregate annual
rental does not exceed P3,000,000
b. The monthly rental per unit exceeds P15,000 and the aggregate annual rental does
not exceed P3,000,000
c. The monthly rental per unit does not exceed P15,000 and the aggregate annual
rental exceeds P3,000,000
d. The monthly rental per unit exceeds P15,000 and the aggregate annual rental
exceeds P3,000,000

9. Which transaction is not subject to VAT?


a. Sale of Mercury Drug of medicines prescribed by doctors to patients that are
confined in a hospital
b. Sale by Mercury Drug of medicines prescribed by doctors to outpatients
c. Sale by a hospital pharmacy of medicines prescribed by doctors to inpatients
d. Sale by a hospital pharmacy of medicines prescribed by doctors to outpatients

10. Which of the following is subject to VAT?


a. Government owned educational institution registered with CHED
b. Privately owned educational institution registered with TESDA
c. Privately owned CPA review center
d. All of the above

Part 2. PROBLEM SOLVING

1. Mama Mathay, 65 years old, died of dengue fever. Prior to her death, she was
hospitalized for three days and was billed P80,000, gross of discount.
The family of Mama Mathay was billed by Imperial Memorial Homes as follows:
Cost of Coffin 60,000
Embalming and related services 100,000
Cremation cost 25,000
Other expenses (gross of VAT):
Obituary notices 5,000
Cost of burial plot 10,000

QUESTIONS:
a. How much should be paid –
i. To the hospital (3 points)
ii. To Imperial Memorial Homes (3 points)
iii. For obituary notices (3 points)
iv. For the cost of burial plot (3 points)

2. Bawal na Gamot Drug Store sold medicines to Biadde Oldy, a senior citizen with
disability. The cost of the medicines amounted to P1,000.
a. How much should be paid by Biadde Oldy to Bawal na Gamot Drugstore? (4
points)
b. What is the entry in the books of the drugstore? (4 points)

3. Urang Gurang rode in an air-conditioned Philtranco bus in Naga City with a normal fare
of P800 from Naga to Manila. How much should be paid by Urang Gurang to the bus
conductor? (4 points)

4. Who among the following sellers of real property is/are subject to VAT? (4 points)
a. Gina, sold her condominium unit (being used as her principal residence) for
P1,200,000
b. Rosalie, a real estate dealer, sold a house and lot for P2,000,000
c. Clarisse, not a real estate dealer, sold her dwelling house for P1,400,000
d. Evelyn, a real estate dealer, sold her real property utilized for socialized housing
for P150,000

5. (1) Orbil owns a sari-sari store which he named as “Close-Open Store”. The annual sales
range from P50,000 to P85,000.
(2) Winston owns a store selling school supplies near the gate of a university. The gross
annual sales range from P2,700,000 to P3,200,000
a. Which of the two establishments is subject to VAT? (3 point)
b. Suppose both establishments are owned by Orbil alone, will his business
establishments be subject to VAT? (3 point)

6. Lolo rendered a lunch for his two grandchildren, Karen and Gina in a popular fast food
chain in town. Karen ordered spaghetti, drinks and burger with an invoice price of
P85.00, gross of VAT. Gina ordered chicken with rice and drinks with an invoice price of
P92.00, while Lolo ordered chicken with spaghetti and drinks worth P106.40, gross of
VAT. How much should be paid by Lolo for the foods ordered? (5 points)

7. Indicate the Value-Added Tax Rate: _________________ (1 point)

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