Tax 2 Problems and Answers

1. Mr. Talib, with a will, died leaving the following properties and obligations to his heirs: Condominium, Cebu City Appliances, Talisay City, Cebu Residential House and Lot, Talisay City, Cebu Jewelry-used by Mr. Talib Patent-Philippines Patent-Korea BMW Car-Japan Cost of burial Cost of tombstone, including upkeep of 5,000 Cost of coffin Judicial expenses Extrajudicial expenses Hospital Bills

8,000,000 300,000 2,000,000 200,000 300,000 400,000 1,000,000 50,000 20,000 80,000 30,000 10,000 600,000

Compute the net taxable estate. a. 10,055,000 c. 8,155,000 b. 9,155,000 d. 9,100,000 2.

Shares of stock of PLDT Corp, kept in safe in Korea 100,000 Shares of Coca-cola Company with business situs in Philippines 50,000 Shares of stock of Pepsi Corp with 85% of business located in Japan 200,000 How much will be included in the gross estate if the decedent is a non-resident alien without reciprocity? a. 350,000 c. 250,000 b. 150,000 d. 300,000 3. Mr. Pats died leaving real property with the following valuations: Fair value of property at time of death 1,200,000 Zonal Value 1,300,000 Adjacent price of property 1,500,000 How much is to be included in the gross estate of Mr. Pats? a. 1,200,000 c. 1,500,000 b. 1,300,000 d. neither of the choices 4. Assuming a decedent has Php 1,000,000, how will this be distributed to his/her heirs and assume further that the decedent died with a will? Legitimate son Surviving Spouse Parents Free Portion a. 500,000 500,000 0 0 b. 500,000 250,000 250,000 0 c. 500,000 250,000 0 250,000

d.

250,000 250,000

250,000

250,000

5. Mr. Taxikad, a non-resident citizen, died with the following property and data: Net estate, Philippines 1,000,000 Net estate, Korea 600,000 Net estate, Japan 400,000 Estate tax paid to Korea 25,000 Estate tax paid to Japan 15,000 Compute for the tax credit for foreign estate taxes paid. a. 27,000 b. 26,500 c. 27,500 d. 26,000 6. Mr. Han, a Japanese residing in Tokyo, Japan, died leaving the following properties: Property located in the Philippines 500,000 Property located in Japan 1,000,000 His administrator in the Philippines claimed the following deductions: Cremation expenses 10,000 Cost of urn 5,000 Judicial expenses 20,000 Indebtedness incurred in the Philippines 85,000 How much is the net taxable estate? a. 460,000 b. 380,000 c. 1,380,000 d. 1,460,000 7. Mr. Bruce Bishop, a citizen and resident of New South Wales, Australia, died leaving properties and obligations in Australia and in the Philippines. Properties in Australia (including family home of 1,000,000) 3,000,000 Properties in the Philippines 1,000,000 Funeral expenses in Australia 250,000 Unpaid obligations in Australia 700,000 Medical expenses in the Philippines 200,000 How much is the net taxable estate in the Philippines? a. 1,000,000 b. 800,000 c. 775,000 d. 0 8. Mr. Bueno, a married Filipino citizen, died in a car accident. He left his wife with their residential house with a fair value of 1,000,000. The lot on which it stands, having a fair value of 400,000, is Mr. Bueno’s exclusive property. How much is the allowable deduction for family home? a. 1,400,000 b. 1,000,000 c. 900,000 d. 700,000

9. Mr. Solomon, a non-resident citizen, died on June 1, 2009 on a plane crash. He left his wife the following properties and charges thereon. The property relationship in the marriage was the conjugal partnership of gains. Family home: Residential house, constructed during marriage 900,000 Residential lot, inherited before marriage 450,000 Household furniture and appliances 490,000 Receivable from an insolvent friend 10,000 Cash, owned before marriage 150,000 Other properties owned before marriage 1,000,000 Medical expenses 120,000 Funeral expenses 100,000 Judicial expenses 120,000 Unpaid mortgage 50,000 Unpaid taxes 20,000 Legacy to Brgy. Ermita, Cebu City 50,000 Loss of household furniture and appliances on December 24, 2009 due to robbery 12,000 How much is the net taxable estate? a. 200,000 b. 830,000 c. 630,000 d. 80,000 10. Mr. Hanes, a non-resident alien, died with the following information: Gross Estate Deductions Estate Tax Paid Philippines 2,000,000 400,000 London 5,000,000 600,000 50,000 How much is the estate tax due after tax credit? a. 103,000 b. 27,467 c. 53,000 d. 29,429 11 – 12. The following were donations all on one date: Real Property in the Philippines Real Property in Kazakhstan Tangible Personal Property in the Philippines Intangible Property in Russia Intangible Personal Property in Maldives Intangible Personal Property in England Intangible Personal Property in Manila Intangible Personal Property in Davao

P 15,000,000 P 28,000,000 P 5,000,000 P 1,850,000 P 600,000 P 450,000 P 800,000 P 150,000

11. Calculate the Gross Gifts, if the donor is a citizen or a resident of the Philippines? a. b. c. d.

P P P P

51,650,000 51,850,000 51,930,000 51,800,000

12. Calculate the Gross Gifts, if the donor is neither a citizen nor a resident of the Philippines?

a. b. c. d.

P P P P

20,950,000 20,800,000 20,900,000 20,850,000

13 – 14. Don Estephanio de la Victoria y Maglasang donated the following during 2011: Date Jan. 10

Mar. 15

Description House and Lot to Sunshine, his legally adopted daughter, on account of her marriage 25,965,000

Market Value P

Lamborghini to Christine June, his legally Adopted daughter on account of her debut

P

22,050,000 Apr. 30

Cash to Ms. Aloyon, his secretary, on account of her birthday. On condition that P 80,000 shall be given to charity.

P

250,000 May 10

Vintage and antique items to Don Fausto, his uncle on account of gratitude P

1,780,000 13. What is Don Estephanio de la Victoria Y Maglasang’s donor’s tax due on his donation on May 10, 2011? a. 297,250 b. 204,750 c. 267,000 d. 265,000 14. What the donor’s tax due on his gifts to strangers? a. 75,000 b. 4,000 c. 10,000 d. 51,000 15. Mr. and Mrs. Allan and Charisse Paran made donations out of their conjugal properties to the following: Date Feb. 14 13,115,000

Donee

Property Donated

To Berna, daughter and Mario, her groom on their marriage last Jan. 30

Fair Market Value

Beach Estate in Palawan P

Apr. 10 285,000

To Phil. National Red Cross (PNRC)

Cash

Apr. 11 3,157,000

To the Province of Samar

May 13

To Rojie, Mrs. Paran’s brother as gift for Rojie’s birthday

P

Cash

P Condo unit P

1,950,000 Jun. 10 P

To Mayor Benculado as gift for his 99,000 Wedding Anniversary

Sept. 15

To Andrea Loraine, Mr. Paran’s sister, for topping the Bar Examinations,

Cash

Cash P

45,950 provided that P 5,850 must be donated to charity What is the donor’s tax payable by Mrs. Charisse Paran on her latest donation to strangers? a. 6,892.50 b. 6,015 c. 12,030 d. 13,785 16 - 17. Mr. Grey donated the following items to his friends because it was his birthday. Receivable from a friend in Australia Receivable from a neigbhor in Cebu Jordan shoes in USA Truck in Lilo-an Alta vista house and lot in Pardo Land in Nevada 16. How much is gross gift if Mr. Grey is a citizen? a. 11,670,000 b. 5,560,000

90, 000 60, 000 20, 000 500, 000 5,000, 000 6,000, 000 c. 5,500,000

d. 6,120,000

17. How much is gross gift if Mr. Grey is a non-resident alien? a. 11,670,000 b. 5,560,000 c. 5,500,000

d. 6,120,000

18 – 19. Mr Blue’s sons are getting married. He donated the following for his sons to start their own lives with their own families. Cash in bank - Davao To eldest son Cash in bank - Lapu-lapu To houseboy considered as son

40, 000 20, 000

Cash in bank - Cebu To adopted son To Sto. Nino church for presiding the wedding

8,000 300, 000

18. How much is deductions from gross gift if Mr. Blue is a citizen? a. 338,000 b. 368,000 c. 318,000 d. 300,000 19. How much is deductions from gross gift if Mr. Blue is a non-resident alien? a. 338,000 b. 368,000 c. 318,000 d. 300,000 20. Mr. Green donated the following to his 3 rd degree cousin. Land in China 200, 000 Car in Philippines 150, 000 Land in Cebu with mortgage of 80, 000 100, 000 Chinese donors 60, 000 Compute for the tax still due if Mr Green is a citizen of Philippines. a. 57,081 b. 36,000 c. 6,800 d. 0 21. Mr. Abella, a seller of merchandise, had the following transactions of goods, inclusive of VAT, during the third month of his business: Sales on account P 336,000 Goods out on consignment – January 10 112,000 February 15 224,000 March 10 168,000 With the given information above, what is the output tax? a. 100,800 c. 54,000 b. 90,000 d. 48,000 22. Mrs. Villaver Company, a first-time VAT-registered person, engages in the sale of goods. The following data are present as of January: Beginning inventory (inclusive of VAT) P 477, 120 Actual VAT paid on the inventory 26, 000 Purchases (inclusive of VAT) 95, 200 Among the beginning inventory in January, 20% of the total inventories were purchased from a non-VAT registered seller. How much is the input tax creditable to the output tax of Mrs. Villaver Company? a. 68, 678.40 c. 36, 200.00 b. 10, 200.00 d. 15, 600.00 23. Antonio Company is engaged in manufacturing of noodles. The information below pertains to transactions happened in the month of January 2014: Purchases during the month – wheat and starches from farmers P 896, 000 Purchases from VAT suppliers Packing materials 96, 320 Supplies 69, 440 Sales 618, 240 In the given information, what is the value-added tax payable for the month of January?

a. 66, 240 b. 53, 600

c. d.

12, 640 0

24. Way Ayu Corporation has the following sales during the month: Sales subject to 12%VAT P 112, 000.00 Sales subject to 0%VAT 100,000.00 Sales of VAT-exempt goods 100,000.00 Total sales for the month P 400, 000.00 The following input taxes were passed on by its VAT suppliers: Input taxes on taxable goods (12%) Php 12,000.00 Input tax on zero-rated sales 3,000.00 Input tax on sale of exempt goods 2,000.00 Compute the total input tax creditable against output tax for the month a. 17, 000 c. 10, 000 b. 15, 000 d. 12, 000 25. Balansag Company, engaged in the sale of variety of goods, has the following purchases for the month of first quarter of 2014: Purchases (for his Sari-sari store): Fresh eggs P 150, 000 Dried fish 300, 000 Sacks of Rice 600, 000 Refined Sugar 616, 000 Junk Foods 16, 800 Softdrinks 392, 000 Sales 85% of each product was sold and for each product the selling price was based on 20% mark-up on cost. How much is the total input tax? a. 109, 800 c. 190, 400 b. 248, 976 d. 230, 780 26. Stephenatics Realties is into selling and leasing of real estate properties. The transactions during the year 2014 include (all amounts are exclusive of taxes): UNITS UNIT COST SALE: Commercial Space 10 1,199,500 Residential Lot 13 1,919,500 Residential House and Lot15 10,000,000

Condo Units Low Cost Housing

20 10

4,000,000 1,200,000

UNITS

MONTHLY RENTAL

LEASE: Commercial Space 12 Residential House and Lot11 Condo Units 10

13,000 15,000 12,800

How much is the output VAT of Stephenatics Realties for 2014? a. 29,277,000 c. 29,461,320 b. 29,039,400 d. 32,271,420 27 - 29. Mr. A, a VAT registered person purchased capital goods, considered as depreciable assets to be used in the production of goods from Mr. B.

Building months Machinery months Equipment months 27. How much is the output tax? a. 626,237 b. 559,140

Acquisition Cost (Invoice Price) 2,149,840

Useful Life 96

2,004 800

36

1,064,000

60

c. 445,140 d. cannot be determined

28. Compute for the input tax based on the foregoing transaction. a. 626,237 c. 445,140 b. 559,140 d. some other answer 29. The monthly amortization of tax input is a. 10,226 c. 9,806 b. 11,706 d. some other answer 30 – 32. Tawantawan Corporation sold a parcel of land with the following data: Consideration stated 3,136,000 Zonal Value 2,500,000 Appraisal Value 3,000,000 Mortgage assumed by the buyer 400,000 Cost to seller 380,000 Cash Payments: Down Payment 1,136,000

Installment Due (for the next 5 years) Creditable Input Tax (current year)

320,000 120,000

30. Compute for the output tax of Tawantawan Corporation. a. 360,000 c. 164,571 b. 336,000 d. some other answer 31. Amortization of Output VAT a. 176,327 c. 0 b. 164,571 d. some other answer 32. VAT Liability for the first year (current year) a. 240,000 c. 44,571 b. 216,000 d. some other answer 33. Mr. Tristan imported a car from London for his personal use. Total landed cost is 800,000 including customs duties of 75,000. How much is the VAT payable? a. 87,000 b. 96,000 c. 10,000 d. 0 34. Mercado Construction Corporation, a VAT registered general construction company imports construction equipments from Japan. Invoice cost, Japan ($1 : P44) $7,500 Value per Bureau of Customs P340,000 Customs duties 35,000 Freight and insurance 17,000 Assuming the customs duties were based on the quantity of the goods imported, the VAT due on the importation is a. P46,660 b. P52,260 c. P45,840 d. P46,050 35. A VAT registered auto repair shop had the following data during the period: Receipts: From auto repair 85,620 From washing and greasing 45,425 Reimbursement by customer on payments made to VAT machine shops 4,350 Payments received for lubricants, oils and fluid provided by the shop to cars undergoing repairs 5,780 Disbursements: Electric bill 3,550 Water bill 2,380 Salaries of employees 15,000 Payments made to machine shops, non-VAT 4,350 Purchase of lubricants, oils and fluids 3,000 How much is the output tax? a. 16,419 b. 12,753 c. 16,941 d. 14,660

36. Mea Man operates (2) passenger jeepneys, (3) taxi cabs, and (5) cargo trucks. During December, the gross receipts are as follows: From passenger jeepneys: Jeepney No. 1 P25,000 Jeepney No. 2 35,000 P 60,000 From taxi cabs: Taxi No. 1 34,000 Taxi No. 2 33,000 Taxi no. 3 33,000 100,000 From transport of cargo Truck No. 1 300,000 Truck No. 2 420,000 Truck No. 3 330,000 Truck No. 4 360,000 Truck No. 5 390,000 1,800,000 From rental of its cargo trucks to individual lessees 230,000 During the month, one of the taxi cabs was bumped by another taxi cab owned by Ingit Tera and paid Mea Man P15,000 for the damage done. The percentage tax due on Mea Man is _________. a . 4,800 c. 1,350 b. 10,950 d. 2,700 37. Fresh Water Company is a holder of a franchise to engage in the business of supplying water to several towns and cities in Cebu. As recorded in its books during November, its total gross receipts from the sale of water amounted to P 3,050,000, while the receipts from the rental of its equipment wa P 300,000 and its other services was P 50,000. The operating expenses amounted to P 2,010,000; 10% of which was paid to VAT registered persons. What is its percentage tax due? a. 61,000 c. 24,820 b. 7,200 d. 91,500 38. Jumega Ambisyosa operates the Impossible Dream Coliseum. During February, it has the following gross receipts from the various activities: Valentine concert by Annie Cortes P 1,500,000 PBA championship game 1,600,000 UAAP basketball game 100,000 Billiard 300,000 Boxing exhibitions 2,300,000 What is the percentage tax payable by Jumega Ambisyosa on the coliseum? a. 240,000 c. 485,000 b. 390,000 d. 470,000

39. Madrama Insurance Company, a domestic corporation, had the following collections from insurance premiums during the month: Property insurance P 3,000,000 Health and accident insurance 2,840,000 Life and disability insurance 2,100,000 Car insurance 1,300,000 Truck insurance 1,500,000 What is the percentage tax due? a. 537,000 c. 247,000 b. 105,000 d. 142,000 40. Madis Karte had the following transactions of shares of stock: Selling Price Cost Sales: Lala Corporation, traded 30,000 25,300 Mama Corp., traded 59,870 49,700 Nana Corp., not traded 123,820 103,850 Papa Corp., traded 90,640 83,530 Purchases: Sasa Corp., not traded 35,040 Tata Corp., not traded 43,675 Wawa Corp., traded 61,090 What is the total percentage tax on the above transactions? a. 597.10 c. 109.90 b. 902.55 d. 415.35

1. B

ANSWER KEY

Gross Estate: Condo 8,000,000 Appliances 300,000 RH and L 2,000,000 jewelry 200,000 Patent-phils 300,000 Patent-korea 40,000 BMW-Japan 1,000,000 Gross Estate 11,840,000 Deductions: Ordinary: Funeral Expenses

Actual 5% of GE Limit

Judicial Expenses Special: Standard Family Home Medical Expenses Actual Limit Total Deductions

145,000 592,000 200,000

145,000 40,000 1,000,000 1,000,000

600,000 500,000

500,000 2,685,000

Gross Estate 11,840,000 Less: Deductions 2,685,000 Net Taxable Estate 9,155,000 2. B Shares of stock of PLDT 100,000 Shares of stock of Coca-cola 50,000 Inclusion in gross estate 150,000 3. B 4. C    

½ to Primary heirs (Legitimate son/daughter and descendants) ½ of share of children for surviving spouse 0 if there is/are primary heirs for parents, same share with surviving spouse Excess is for free portion for free disposal

5. C Philippine estate tax: On 500,000 15,000 Excess 8% 40,000 Estate tax 55,000

Allowable tax credit: Limit 1 Korea (600,000/2,000,000 x 55,000) Actual Allowed

16,500 25,000 16,500

Japan (400,000/2,000,000 x 55,000) 11,000 Actual 12,000 11,000 Total Limit 1 27,500 Limit 2 (1,000,000/2,000,000 x 55,000) 27,500 Actual 37,000 Allowed 27,500 Tax credit to be deducted (lower of Limit 1 and limit 2)

27,500

6. A The decedent is a non-resident alien. His gross estate includes only those located in the Philippines. Gross Estate 500,000 Less: Deductions: Funeral expenses 15,000 Judicial expenses 20,000 Indebtedness 85,000 Total 120,000 Limit: 500,000/1,500,000 x 120,000 40,000 Net Taxable Estate 460,000 7. C Gross Estate, Philippines 1,000,000 Less: Deductions: Funeral expenses: Actual 250,000 Allowed 200,000 200,000 Unpaid obligations 700,000 Total 900,000 Limit: 1,000,000/4,000,000 x 900,000 225,000 Net Taxable Estate 775,000 A non-resident alien decedent has no deduction for standard deduction, medical expenses and family home. 8. C Family Home: Exclusive lot Conjugal home (1,000,000/2) Total

400,000 500,000 900,000

9. D Exclusive Conjugal Total Gross Estate: Family home: House Lot 450,000 Household furniture and appliances Claim against insolvent person Cash 150,000 Other properties 1,000,000 Total 1,600,000 Ordinary Deductions: Funeral expenses Judicial expenses Unpaid mortgage Unpaid taxes Legacy 50,000 Claim against insolvent person ________ Total 50,000 Net Estate 1,550,000 2,650,000 Special Deductions: Standard deduction 1,000,000 Medical expenses 120,000 Family home Exclusive 450,000 Conjugal (900,000/2) 450,000 900,000 Net Estate 630,000 Less: Net Share of Surviving Spouse (1,100,000/2) 550,000 Net Taxable Estate 80,000

900,000 490,000 10,000 ________ 1,400,000 100,000 120,000 50,000 20,000 10,000 300,000 1,100,000

10. A Gross Estate, Philippines 2,000,000 Less: Deductions 400,000 Net Estate 1,600,000 Estate Tax on 500,000 15,000 on excess ( 1,100,000 x 8%) 88,000 Estate Tax Due 103,000 A non-resident alien is not entitled to tax credit. 11. B 12. A

Citizen or

Non-

Resident

Not citizen

resident, Real Property in the Philippines 15,000,000 Real Property in Kazakhstan Tangible Personal Property in the Philippines 5,000,000 Intangible Property in Russia Intangible Personal Property in Maldives Intangible Personal Property in England Intangible Personal Property in Manila 800,000 Intangible Personal Property in Davao 150,000 Gross Gifts 20,950,000

P 15,000,000

P

P 28,000,000 P 5,000,000

P

P

P 1,850,000 P 600,000 P 450,000 800,000

P

P

150,000

P

P 51,850,000

P

13. C 14. D Non-Strangers: May 10

Gross Gift: Vintage and antique items Less: Deductions Net Taxable Gift Add: Prior Net Gifts Jan. 10 House & Lot Less: Deductions-dowry

P 1,780,000 0 1,780,000 P 25,965,000 10,000

25,955,000 Mar. 15

Lamborghini Less: Deductions Aggregate Net Gifts

P 22,050,000 0 22,050,000 P

49,785,000 Donor’s tax on P 10,000,000

P

1,004,000 Tax on excess (49,785,000-10,000,000) x 15% 5,967,750 Donor’s Tax on Aggregate Net Gifts 6,971,750 Less: Donor’s Tax on all Prior Net gifts Donor’s Tax on Current gift

6,704,750 P

267,000 Strangers: Apr. 10

Gross Gift: Cash to his secretary, a stranger

P

250,000

Less: Deduction- diminution by the donor 80,000 Net Taxable Gift Multiply by donor’s tax rate applicable for strangers Donor’s tax due P

170,000 30% 51,000

15. B Gross Gift (45,950/2) Less: Exemption (5,850/2) Net Gift Multiply by DT rate to Strangers Donor’s Tax due

P 22,975 2,925 20,050 30% P 6,015

16. A 17. B Citizen Land-Nevada H&L- Pardo Truck-Lilo-an Jordan shoes-USA Receivable-neighbor Receivable-friend in Australia Gross gift

Non –resident alien

600, 000 5,000, 000 500, 000 20,000 60, 000 90, 000 11,670,000

5,000, 000 500, 000 60, 000 ________ 5,560, 000

18. C 19. D Deductions from gross gift Citizen Cash in bank-Davao 10, 000 Eldest son Cash in bank – Cebu 8,000 Adopted son To sto. Nino church 300, 000 Cash Deductions from gross gift 318, 000 20. A Land in China 200, 000 Car in Philippines 150, 000 Land in Cebu 100, 000 Mortgage payable-land Cebu-80, 000 Gross gift 320, 000 Donors tax rate- stranger x 30% Donor’s tax 96, 000 Less: Tax credit 38, 919

Non- resident alien

300, 000 300, 000

Actual paid 60, 000 150, 000 370, 000 X 96, 000 = 38, 919 Donor’s tax still due -

57, 081

21. D 22. C 23. C Output tax (618, 240 x .12/1.12) P 66, 240 Less: Input taxes: Presumptive input tax (896, 000 x .04) 35, 840 Purchase on packing materials (96, 320 x .12/1.12) 10, 320 Supplies (69, 440 x .12/1.12) 7, 440 53, 600 Value-added tax payable P 12, 640 24. B Input taxes on taxable goods (12%) P 12, 000 Add: Input tax on zero-rated sales 3, 000 Total Input Tax 15, 000 Input tax from a purchase of goods in a zero-rated transaction is allowed to credit such input tax against the output tax of the company. But, in an exempt transaction, input tax is not allowed to be credited against the output tax. 25. A Purchases Refined Sugar (616, 000 x .12/1.12) Junk Foods (16, 800 x .12/1.12) Softdrinks (392, 000 x .12/1.12) Total Input Tax

66, 000 1, 800 42, 000 P109, 800

26. A 27. D Cannot be determined since it was not stated how much was the sales for the period. 28. B Input VAT: Building Machinery Equipment Total

2,149,840/1.12x12% = 230,340 2,004,800/1.12x12% = 214,800 1,064,000/1.12x12% = 114,000 559,140

29. C Monthly Amortization: Building Machinery Equipment

230,340/60 = 3,839 214,800/36 = 5,967 not amortized _____

Total

9,806

30. A Initial payments Consideration stated

= 1,136,000+400,000+20,000-400,000 3,136,000 = 36.86% (Deferred basis) Output Tax = 3,000,000x12% = 360,000

31. C No amortization since it is on a deferred basis. 32. A VAT Liability Output Tax 360,000 Less: Creditable Input Tax 120,000 VAT Liability 240,000 33. B Total landed cost X VAT payable

800,000 12% 96,000

34. C Invoice cost (7,500 x 44) Add: Customs duties Freight and insurance Landed cost X VAT

P330,000 P35,000 17,000

52,000 382,000 12% P45,840

35. A Receipts from auto repair shop Receipts from washing and greasing Payment received for lubricants, etc. Total gross receipts X Output tax

85,620 45,425 5,780 136,825 12% 16,419

Receipts from 2 passenger jeepneys Receipts from 3 taxi cabs Total receipts Rate of tax Common carrier’s tax

P 60,000 100,000 160,000 x 3% 4,800

36. A

37. A

Gross receipts- sale of water Rate of tax Franchise tax

x

P 3,050,000 2% 61,000

38. D PBA championship game P 1,600,000 x 15% = 240,000 Boxing exhibitions 2,300,000 x 10% = 230,000 Amusement tax 470,000 39. C Health and accident insurance Life and disability insurance Total collections on life insurance Rate of tax Percentage tax 40. B Mama Corp. P30,000 Nana Corp. 59,870 Papa Corp. 90,640 Gross Selling Price 180,510 Rate of tax x 0.5% Percentage tax 902.55

x

P 2,840,000 2,100,000 4,940,000 5% 247,000