VAT
1. LBJ made the following sales during the 12-month period:
Sales, VAT taxable transactions
P1,500,000
Sales, VAT zero-rated transactions
400,000
Sales, VAT exempt transactions
100,000
Total P2,000,000
Which of the following statements is correct?
a. LBJ may not register under the VAT system because his sales from VAT taxable transactions
did not exceed P1,919,500.
b. LBJ may not register under the VAT system because his sales from VAT taxable and zerorated transactions did not exceed P1,919,500.
c. LBJ is required to register because his total 12-month sales exceeded P1,919,500.
d. None of the foregoing.
2. Which of the following is exempt from VAT?
a. Common carriers transporting passengers by air within the Philippines
b. Common carriers transporting passengers by sea within the Philippines
c. Common carriers transporting passengers by land within the Philippines
d. Common carriers transporting cargoes by air within the Philippines
3. Which statement is correct about value-added tax on goods or properties sold?
a. It is based on gross sales and not on net sales;
b. May be due even if the goods or properties were not actually sold;
c. Does not cover goods exported;
d. It forms part of the selling expense of the trader.
4. For value-added tax purposes, which of the following transactions of a VAT-registered taxpayer may
not be zero-rated?
a. Export sales
b. Foreign currency denominated sales
c. Sale of goods to the Asian Development Bank
d. Sale of goods to an export oriented enterprise
5. A subdivision developer sold five (5) residential house and lots, each to different vendees, for
P3,000,000 per lot, or a total sales of P15,000,000 for the taxable period.
These sales shall be classified as:
a. 12% VAT transactions
b. 0% VAT transactions
c. VAT exempt transactions
d. None of the foregoing
6. CP operated a retail business that had been generating sales not exceeding the threshold for VAT
exempt persons. However, he desires to be registered under the VAT system for the first time in order to
benefit from input tax credits.
What benefit may CP be entitled to once he registers under the VAT system?
a. Tax refund
b. Presumptive input tax credit
c. Transitional input tax credit
d. None of the foregoing
7. What institution is required to deduct and withhold a final VAT of 5% on the purchase of goods or
services subject to VAT?
a. National government or any political subdivision thereof
b. Government-owned or controlled corporations
c. Both (a) and (b)
d. Neither (a) nor (b)
8. In the value-added tax on sale of services, the output tax is computed:
a. On the billings of the month
b. On collections of the month on all billings made
c. On the contract price of contracts completed during the taxable period
d. Only and strictly on labor performed under the contract for services
9. Which statement is wrong?
a. There is a transitional input tax from purchases of goods or properties;
b. There is a transitional input tax from purchases of services;
c. There is a transitional input tax from purchases of materials;
d. There is a transitional input tax from purchases of supplies.
10. Which of the following statements is correct on the inventory balance in the financial statements at
any given date of a VAT registered person?
a. Balance, net of input taxes
b. Balance, inclusive of input taxes
c. Balance on which the transitional input tax is computed annually
d. Balance where the VAT thereon may be calculated by multiplying it by 12%
11. Genson Distribution Inc., a VAT taxpayer, had the following data in a month:
Cash sales
P200,000
Open account sales
500,000
Consignment:
0 to 30 days old (on which there were remittances from consignees of P200,000) 600,000
31 to 60 days old
700,000
61 days old and above
900,000
How much is the output tax?
a. P348,000
c. P264,000
b. P216,000
d. P108,000
12. The financial records of Benz Corp., a VAT-registered taxpayer, for the taxable year 2016 disclosed
the following:
Local sales to private entities 1,500,000
Export Sales
500,000
Local sales to government
800,000
How much is the total sales subject to value-added tax?
a. P2,800,000 c. P2,000,000
b. P2,300,000 d. P1,500,000
13. Mantika Corp., a VAT-registered Corp., is a producer of cooking oil from coconut and corn. It had the
following data for the month of January 2017:
Sales, gross of VAT P
784,000
Corn & Coconut, 12-31-16
50,000
Purchases of Corn & Coconut 330,000
Corn & Coconut, 1-31-17
20,000
Purchases from VAT suppliers, VAT included:
Packaging Materials 56,000
Supplies 16,800
The value-added tax payable for the month:
a. P56,060
c. P60,650
b. P54,900
d. P63,000
14. Bunga Inc., a VAT taxpayer, is engage in the business of processing of fruits. Its data on sales and
purchases for the month of August are provided below:
Sales P200,000
Purchases:
Fresh Fruits 30,000
Raw sugarcane 12,000
Tin Can, gross of VAT 12,320
Paper Labels, net of VAT 5,000
Cardboard for boxes, net of VAT 8,000
Freight, gross of VAT (50% still unpaid) 10,080
How much is the value-added tax payable?
a. P20,580
c. P19,380
b. P18,900
d. P20,100
15. Bahay Kubo Inc. is a real estate dealer. Details of its sales during the year showed the following:
Date of sale
June 2, 2017
Consideration in the deed of sale
P 5,000,000
Fair market value in the assessment rolls
4,800,000
Zonal Value
5,200,000
Schedule of payments:
June 2, 2017 1,000,000
June 2, 2018 2,000,000
June 2, 2019 2,000,000
How much is the output tax to be recognized for the June 2, 2018
payment?
a. P0
c. P249,600
b. P124,800
d. P624,000
16. Assuming that the scheduled payment on June 2, 2017 is P2,000,000, how much is the output tax to
be recognized for the June 2, 2019 payment?
a. P0
c. P249,600
b. P124,800
d. P624,000
17. Mr. Karpentero, a vat-registered building contractor, has the
following data on gross receipts in a month, any tax not included:
 From Mr. A, a private property owner, final payment on the contract price, net of 5% agreed
retention fee of P2,850,000
 From Mr. B, a payment of 5% retention on the contract price previously made by him P100,000
 From Mr. C, for materials used in the construction 500,000
How much is the output tax?
a. P414,000
c. P72,000
b. P342,000
d. P62,000
18. COC Inc., in its first month of operation, and as a VAT taxpayer, purchased various fixed assets.
Purchases of fixed assets in the first month were as follows:
Light equipment, with a useful life of 3 years
P 300,000
Heavy equipment, with a useful life of 10 years 4,000,000
How much is the input tax available for the month?
a. P516,000
c. P480,000
b. P9,000
d. P8,600
19. Kusina Co., had its kitchen assembled by a VAT taxpayer. It took six months for the contractor to
finish the work. Kusina Co. purchased materials in July from VAT suppliers at a cost of P500,000, VAT
not included. Payment to the contractor in July 2017 on the Construction in Progress, VAT not included
was:
On contractor’s billing in June P100,000
On contractor’s billing in July 70,000
The input tax available in July is:
a. P0
c. P60,000
b. P80,400
d. P20,400
20. Data from the books of accounts of a VAT taxpayer for February:
Domestic
Exports
Sales
P 2,000,000 8,000,000
Purchases:
From VAT Suppliers:
Goods for sale
600,000
2,400,000
Supplies & service
90,000
360,000
From Suppliers Paying percentage tax:
Goods for sale
100,000 1,500,000
Supplies & services
20,000
80,000
If the input taxes attributable to zero-rated sales are claimed as tax credit, the net value-added tax
refundable is:
a. P136,000
c. P145,000
b. P203,924.70
d. P174,000