1.

During 2019, Alpha Corp gave the following:

De minimis benefits to rank and file employees 54,400
De minimis benefits to managerial employees 27,200
Fringe benefits to rank and file employees 102,000
Fringe benefits to managerial employees 170,000

How much is the fringe benefits tax?

A. 48,000
B. 80,000
C. 91,538
D. 166,400

2. The following earnings are subject to fringe benefit tax, except:

a. Salary of rank and file employee
b. Housing necessary for the trade and for the convenience of the employer.
c. Food allowance for the convenience of the employer and necessary in the conduct of business
D. none of the above

3. The following statements are true, except?

a. Fringe benefit tax shall be treated as a final income tax on the employee withheld and paid by the employer
on a quarterly basis.
B. The grossed-up monetary value of the fringe benefit is the actual amount received by the employee.
c. The grossed-up monetary value of the fringe benefit shall be determined by dividing the monetary value of
the fringe benefit by the gross monetary value factor
d. The person liable for fringe benefit tax it’s the employer.

4. Statement 1: A fringe benefit that is exempt from fringe benefit tax is likewise exempt from any other form of
income tax.
Statement 2: Any amount given by the employer as de minimis benefits to its employees, shall not constitute as
deduction upon such employer.
Which statement is/are true?
a. Statement 2
b. Statement 1
c. both statement
D. neither statement

5. Sarah a regular employee of Confererate Inc. receives for the month of July her 30,000 regular monthly salary
and half of his 13th month pay amounting to 15,000 plus other benefits such as rice allowance of 2,500, incentive
pay 20,000, hazard pay 10,000, overtime pay 4,000 and night shift differential of 2,000.
A. 66,000
B. 83,500
C. 0
D. 81,500
6. Mayaman Corp. owns a fleet of motor vehicles. In 2019, one of the cars which was acquired at a cost of 400,000
was allowed as service vehicle by one of its officials. During the year its fair value amounted to 375,000. How
much was the fringe benefit tax due?
A. 22,300
B. 21,538
C. 20,192
D. 0

7. The following organization shall not be taxed in respect to income received by them as such, except:
A. Non-stock and nonprofit educational institution
B. Government educational institution
C. Nonprofit Hospitals
D. Cemetary Company owned and operated exclusively for the benefit of its members

8. A resident alien received 40,000 prize from SM Department store. Which of the following statements is correct
in connection with the imposition of final tax on prize?
A. The first 10,000 is part of taxable income, the remaining 30,000 is subject to 20% Final Tax
B. The whole amount is part of taxable income
C. The whole amount of 40,000 shall be subject to 20% final tax.
D. The first 10,000 is exempt, the remaining 30,000 is subject to 20% Final Tax.

9. Which of the following statement on fringe benefits is correct?

A. Not part of the taxable income of the employees.
B. Part of the taxable income of the employees
C. The monetary value is subject to fringe benefits tax
D. The tax is imposed on the employer and withheld at source

10. A general professional partnership and its partners are subject to the following rules, except:
A. The GPP is not subject to income tax
B. The partners shall be liable for income tax only in their separate or individual capacity
C. Each partner shall report as gross income his distributive share in the partnership net income.
D. The share of the partner shall be subject to Final tax of 10%.

11. A cash dividend of 100,000 received by a taxpayer in 2019 from a foreign corporation whose income from
Philippine source is 50% of its total income is:
Statement 1: Partly taxable if he is a resident citizen
Statement 2: Partly taxable if he is non-resident citizen
A. True, true
B. False, true
C. True, False
D. False, False
12. A cash dividend of 100,000 received by a taxpayer in 2019 from a foreign corporation whose income from
Philippine source is 50% of its total income. Using this data which of the following is correct, The cash dividend is
A. Exempt from income tax if he is a resident citizen
B. Partly taxable if he is a resident alien
C. Taxable in full if he is a non-resident citizen
D. Exempt from income tax if he is a non-resident alien

13.
XYX Corp a domestic corp had the following data during the calendar year 2019
Gross Income 1,000,000
Business expenses 400,000
Dividend from:
1. Domestic Corp 100,000
2. Foreign corp, 90% of its gross income was derived from the PH 100,000
3. Foreign corp, 60% of its gross income was derived from the PH 80,000
4. Foreign corp, 30% of its gross income was derived from the PH 40,000
The Taxable income is:
a. 920,000
b. 820,000
c. 748,000
d. 750,000

14. This income is subject to final tax:

A. Fringe benefits given to rank and file employees
B. Marriage fees, baptismal offerings received by a clergyman
C. Dividend income from a domestic corp by a resident foreign corp
D. Share of an individual from the distributable net income of a general co-partnership

15. A acquired his residential land in 2000 at cost of 1 million. A sold the property on January 2, 2020 for a price of
4,000,000 when the FMV was 5 Million. Within 18 months. A purchased his new principal residence at a cost of
7,000,000. How much is the capital gains tax?
a. 300,000
b. 240,000
c. 75,000
d. 0

16. Income from the performance of service is treated as income within the Philippines if
a. The payment of compensation for the service is made in the Philippines
b. The contract calling for the performance of service is signed in the Philippines
c. The service is actually performed in the Philippines
d. The recipient of service income is a resident of the Philippines.
17. The Term capital assets include:
a. Stock in trade or other property included In the taxpayer’s inventory
b. Real property not used in the trade or business of taxpayer
c. Property primarily for sale to customers in the ordinary course or trade of business
d. Property used in the trade or business of the taxpayer and subject to deprecation.
18. Lots being rented when subsequently sold are classified as
a. capital assets
b. liquid assets
c. ordinary assets
d. fixed assets
19. Mr. Julio cantas is not engaged in real estate business. He sold a 1,000 square meter residential land for 300,000
on March 15, 2011. The land was acquired by purchase on March 5, 2008 for 120,000. After acquisition the land
was fenced at a cost of 30,000. A commission of 5% of the sales price was paid to the sales agent.
How much is the capital gains tax due?
a. 18,000
b. 18,900
c. 7,200
d. 9,000
20. Rotly sold 1,500 shares of stocks of achievers corp. The par value per share was P85 but were acquired by him at
P90. On the date of sale the shares had a selling price of 120 per share.
The capital gains tax on the sale if the shares are not listed and traded in the PSE is:
a. 6,750
b. 7,875
c. 6,600
d. 7,500
21. Ronald sold 1,000 shares of not listed and traded. The data of which are as follows:
Selling Price 600,000, Fair market value 620,000, Expenses on the sale 10,000, Purchase price 440,000, expenses
upon acquisition 3,000

The capital gains tax due is

a. 22,050
b. 22,000
c. 21,050
d. 22,100
22. For purposes of income taxation, which of the following is not considered as a corporation?
a. General professional partnership
b. Business partnership
c. Unregistered partnership
d. Join stock companies
23.
Equipment’s Corp. a domestic corp has the following records of income and expenses in 2011
Gross Income, net of 1% withholding tax 1,435,500
Expenses 756,000
Rent Income, net of 5% withholding tax 136,800
Expenses of rent 34,600
Dividend from domestic corp. 25,000
Royalty 80,000
Interest from bank deposit with PNB, gross of tax 15,000

The Income tax payable by equipment corp is?

a. 241,020
b. 219,320
c. 803,400
d. 259,490

24. Equipment’s Corp. a domestic corp has the following records of income and expenses in 2011
Gross Income, net of 1% withholding tax 1,435,500
Expenses 756,000
Rent Income, net of 5% withholding tax 136,800
Expenses of rent 34,600
Dividend from domestic corp. 25,000
Royalty 80,000
Interest from bank deposit with PNB, gross of tax 15,000

The final tax payable by equipment corp is?

A. 19,000
B. 21,500
c. 33,250
d. 3,000

25. Alliance Corp, a corporation engaged in the business in the Philippines and abroad has the following data:
Gross Income, Philippines 975,000
Expenses, Philippines 750,000
Gross Income, USA 770,000
Expenses, USA 630,000
Interest on Bank deposit 25,000

The income tax due if the corporation is-

A. Domestic: 116,800 Resident Foreign: 72,000 Nonresident Foreign: 300,000

B. Domestic: 109,500 Resident Foreign: 76,750 Nonresident Foreign: 250,000
C. Domestic: 312,800 Resident Foreign: 67,500 Nonresident Foreign: 220,000
D. Domestic: 109,500 Resident Foreign: 67,500 Nonresident Foreign: 300,000
26. Tralala Corporation, a domestic corporation has the following record of income and expenses during the year:
Gross income 1,540,000
Expenses 654,000
Dividend from a Foreign Corp. 95,000
Royalties, PH 230,000
Royalties, US 175,000
Interest income on time deposit 18,000
Interest on money market placement 25,000

The taxable income of tralala corp is

a. 346,800
b. 1,156,000
c. 641,000
d. 616,000

27. Meldy Corp had the following items of income and expenses during the year.
Gross receipts 1,000,000
Cost of services 850,000
Dividends from a domestic corp 35,000
General and admin expense 120,000

The income taxdue on meldy is

a. 10,500
b. 3,000
c. 9,000
d. 30,000

28. Erika Corp had the following data

2018 2019
Gross Income 3,500,000 2,400,000
Taxable Income 125,000 500,000

The income tax payable of Irene corp in 2019 is:

A. 150,000
B. 124,750
C. 148,750
D. 117,500
29. Delta Corp an entity organized under the laws of Russia is engage in business in the Philippines for 10 years
already. During the year 2018 its income and expenses are shown below:
PH Russia
Gross Income 20,000,000 30,000,000
Business Expense 19,000,000 21,000,000
Interest income from dollar account 500,000
Yield on Money market placement 1,000,000

How much is the income tax payable of Delta Corp?

A. 3,000,000
B. 450,000
C. 400,000
D. 300,000

30. Which taxpayer is subject to Minimum corporate income tax?

A. Private Schools
B. Government owned and controlled operations
C. Offshore banking units
D. International Carriers

31. Excess MCIT is tax credit that can be carried over to the next
a. 3 consecutive years
b. 4 consecutive years
c. 3 years including the year it arises
d. 3 consecutive years when there is income

32. Which is deductible in the computation of the MCIT

a. marketing expenses
b. Office utilities
c. Loss on sale of assets
d. Salaries of employees directly engaged in rendering the service.

33. Which of these may grant relief from the MCIT

a. Secretary of Finance
b. Office of the CIR
c. Office of the Revenue district officer having jurisdiction
d. National office of the BIR

34. Which of the following is not a direct cost of service of a corporate car-parking operator
a. Marketing expenses
b. cashier salaries
c. Deprecation of Parking building
d. Security guard salaries
35. Which of the following is not a deduction in the computation of the income tax payable or refundable?
a. Estimated quarterly income tax payment
b. Final withholding tax on passive income
c. Excess MCIT prior year
d. Creditable withholding tax on gross income

36. Shown below are the operating results of Bulalacao Corp since its start of oeprations:
Gross Income Deductions
2011 4,000,000 5,000,000
2012 4,500,000 5,200,000
2013 5,500,000 5,000,000
2014 6,000,000 5,800,000
2015 6,500,000 6,100,000
2016 7,000,000 6,200,000

What is the income tax due for 2014 and 2015?

a. 120,000 : 0
b. 120,000 : 70,000
c. 120,000: 130,000
d. 0 : 130,000

37. Shown below are the operating results of Bulalacao Corp since its start of oeprations:
Gross Income Deductions
2011 4,000,000 5,000,000
2012 4,500,000 5,200,000
2013 5,500,000 5,000,000
2014 6,000,000 5,800,000
2015 6,500,000 6,100,000
2016 7,000,000 6,200,000

What is the income tax due for 2016?

a. 240,000
b. 230,000
c. 120,000
d. 110,000

38. The Calintaan Corp. had the following historical MCIT and RCIT data:
2013 2014 2015 2016
MCIT 120,000 200,000 190,000 170,000
RCIT 110,000 220,000 0 180,000
How much is the tax due and payable for 2013 and 2014?

A. 120,000: 220,000
B. 120,000: 100,000
C. 120,000: 210,000
D. 110,000: 220,000
39. The Calintaan Corp. had the following historical MCIT and RCIT data:
2013 2014 2015 2016
MCIT 120,000 200,000 190,000 170,000
RCIT 110,000 220,000 0 180,000
How much is the tax due and payable for 2015 and 2016?
a. 190,000: 0
b. 190,000: 180,000
c. 0: 0
d. 170,000: 0

40. Erika Corp. started operations in 2007. The following shows details of its income in 2015:
2013 2014 2015
Gross Income 1,000,000 2,000,000 8,000,000
Expenses 2,000,000 2,500,000 6,000,000
Operation had been profitable since start of operation except that a major strike in 2013 and 2014 caused major
problems. Erika Corp. requested for lifting of the MCIT which was granted for the year 2013 and 2014. Compute
the income tax payable in 2015.
a. 450,000
b. 160,000
c. 150,000
d. 0

41. During 2018, a domestic corp. derived the following items of revenues:
A. Gross Receipts from a trading business, 500,000
B. Interests from money placements in banks, 30,000
C. Dividends from its stock investment in a domestic corp.,20,000
D. Gains from stock transactions through the PSE, 50,000
E. Proceeds under an insurance policy from lost of goods, 100,000
F. Interest Income from a personal receivable, 50,000

How much should the corporation report as taxable income?

A. 500,000
B. 550,000
C. 600,000
D. 650,000
42. Lenovo Inc. a domestic foreign Corp. has earned the following income during 2018:
Dividend Income from:
Microsoft, a non-resident corp 500,000
Intel, a resident foreign corp 400,000
Panday, a domestic corp 300,000
Interest income from:
Current account, BDO 600,000
Savings Deposit, ABN-AMRO bank, UK 600,000
US dollar deposit, BPI 800,000
Royalty Income from various domestic corp 100,000
How much is the total income tax expense?
A. 200,000
B. 560,000
c. 710,000
d. 740,000

43. The share of a co-venturer corporation in the net income after tax of a joint venture or consortium taxable as a
corporation is:
A. Subject to Final withholding tax of 20%
B. Subject to regular corporate income tax of 30%
c. Subject to capital gains tax
D. exempt from income tax
44. The share of a co-venturer individual the net income after tax of a joint venture or consortium taxable as a
corporation is:
A. Subject to Final withholding tax of 20%
B. Subject to regular corporate income tax of 30%
c. Subject to capital gains tax
D. Subject to Final withholding tax of 10%