Long Quiz 002

Week 10
30/30

Submitted by: Mr. Alfie G. Rellon (FB and Messenger) (AMA OED Student) (agrsaudi: username in the site)

1. One of the following expenses is deductible from gross income

Select one:
a. Amount paid out for new building construction
b. Personal, living and family expenses
c. Premiums paid on a life insurance policy covering the life of the employee of which the members of the family of the
employee are beneficiaries
d. Any amount disbursed in restoring the property

2. During the taxable year, Mr. Juan Dela Cruz separated legally from his wife, Andrea. The legally separated spouses
have four qualified dependent children. Both spouses were earning with the following gross taxable income: Mr. Juan
Dela Cruz, P380,000; Ms. Andrea, P250,000. For custody, the court granted Mr. Dela Cruz the two children and Ms.
Andrea the remaining two children. Meanwhile, Mr. Juan Dela Cruz is supporting his niece who is 21 years old,
unmarried, and not gainfully employed. Both spouses have monthly premium payment of P150 for health and insurance.
The allowable deduction for health and hospitalization insurance of Mr. Dela Cruz is:
Select one:
a. P3,000
b. P1,800
c. Zero
d. P2,400

3. In 2016, Pedro's wife died of a car accident. His dependents are as follows:
A, child, 22 years old, employed on July 12, 2016
B, child, 21 years old on November 2, 2016
C, child, 18 years old, married on January 31, 2016
D, child, 17 years old, gainfully employed on October 1, 2016
E, child, 15 afflicted with sore eyes on May 6, 2016
F, child, 13 died together with his wife in a car accident in 2016
G, sibling, 28 paralytic
For taxable year 2016, Pedro can claim additional exemptions of
Select one:
a. P25,000
b. P100,000
c. P 75,000
d. P125,000

4. Ms. Nene By retired from the company after serving for eight years as receiving clerk. During the period of her
retirement, she received the following:
? Annual basic salary, P144,000
? Christmas bonus and cash gift P20,000
? Cost of living allowance, P2,500 monthly
? Retirement benefits from SSS, P350,000
? Retirement benefits from employer where the company has an approved retirement benefit plan, P45,000
? Monetization of her 10-day leave credits, P4,000
During the same period, the taxpayer has an actual payment for health insurance of P3,600. The taxpayer is a widow
who supports her two qualified children and two children of her husband from his first wife, who are below 21 years old,
unmarried and not gainfully employed.
The gross taxable compensation income will amount to:
Select one:
a. P219,000
b. P234,000
c. P424,000
d. P484,000
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5. Mr. A received the following from his employer during the current taxable year:
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Monthly basic salary, P45,000
Monthly representation and travelling allowance not subject to liquidation, P10,000
5% commission on net sales. Sales during the year were P6,300,000; sales return, P250,000
13th month pay, Christmas bonus and productivity pay amounting to 120% of his basic salary The gross taxable
compensation income of Mr. A for the current taxable year is:
Select one:
a. P841,500
b. P986,500
c. P962,500
d. P1,016,500

6. Mirabella's husband died in April 2016, leaving seven (7) unmarried children living with and wholly dependent on her
for chief support. The ages of the children are as follows:
Children Ages Status
Aaa 24 jobless
Baa 22 mentally retarted
Caa 19 studying in Manila
Daa 10 studying in their hometown
Eaa 8 studying in their hometown
Faa 6 studying in their hometown
Gaa 3 taken by the grandparents for full support
For purposes of taxable year 2017, how many are the qualified dependents?
Select one:
a. 6
b. 7
c. 5
d. 4

7. Ms. AC rented the vacant lot owned by Mr. X for a monthly rental of P10,000. The lease contract took effect on April 1,
2016 for a lease period of 25 years. The lessee, right after the consummation of the lease contract, constructed a
commercial building on the lot costing P6,000,000 with an estimated useful life of 50 years and a residual value of
P400,000. When the building was completed on January 1, 2017, the fair market value of the property was P8,000,000
per valuation made by the independent appraiser.
The building will become the property of the lessor after the expiration of the lease.
In addition, the annual property tax on the lot of P6,000 will be paid by the lessee.
Using the outright method of reporting income from leasehold improvement, the taxable rent income for the year 2016
will be:
Select one:
a. P126,000
b. P8,126,000
c. P94,500
d. P6,126,000

8. All of the following are requisites in the carry-over of net operating loss, except:
Select one:
a. There must be no substantial change in the ownership of the business
b. The carry-over is good for only one (1) year
c. Carry over is not allowed if the corporation is subject to MCIT during the taxable year
d. Even if a corporation paid tax based on MCIT, the running of the prescriptive period is not interrupted

9. Ms. Nene By retired from the company after serving for eight years as receiving clerk. During the period of her
retirement, she received the following:

Annual basic salary, P144,000

Christmas bonus and cash gift P20,000
Cost of living allowance, P2,500 monthly
Retirement benefits from SSS, P350,000
Retirement benefits from employer where the company has an approved retirement benefit plan, P45,000
Monetization of was
This study source herdownloaded
10-day byleave credits, P4,000
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During the same period, the taxpayer has an actual payment for health insurance of P3,600. The taxpayer is a widow
who supports her two qualified children and two children of her husband from his first wife, who are below 21 years old,
unmarried and not gainfully employed. Using the same data in Number 24, the net taxable compensation income is:

Select one:
a. P321,600
b. P131,600
c. P116,600
d. P381,600

10. A building was partially destroyed by fire in 2016. Its book value was P2,000,000. The insurance company was
willing to pay P1,000,000 which was refused by the owner of the building. Finally, the claim was settled in 2017 for
P1,500,000. The P1,500,000 proceeds is
Select one:
a. Subject to final tax
b. Taxable in full
c. Party taxable, partly exempt
d. Exempt from income tax

11. Juana, widow, earning an annual gross compensation income of P300,000 has the following dependent children in
2017
Aubrey - baby, born on January 31
Barbara - celebrated her 21st birthday last June 12
Cristeta - married on January 1
Diana -gainfully employed effective July 1
Eliza - died of dengue fever on September 30
Assuming Juana has two employers, her taxable income in 2017 is:
Select one:
a. P150,000
b. P32,000
c. P63,000
d. P100,000

12. Juana, widow, earning an annual gross compensation income of P300,000 has the following dependent children in
2017
Aubrey - baby, born on January 31
Barbara - celebrated her 21st birthday last June 12
Cristeta - married on January 1
Diana - gainfully employed effective July 1
Eliza - died of dengue fever on September 30
The taxable income of Juana in 2018 is:
Select one:
a. P95,000
b. P120,000
c. P87,000
d. P225,000

13. Mirabella's husband died in April 2016, leaving seven (7) unmarried children living with and wholly dependent on her
for chief support. The ages of the children are as follows:
Children Ages Status
Aaa 24 jobless
Baa 22 mentally retarted
Caa 19 studying in Manila
Daa 10 studying in their hometown
Eaa 8 studying in their hometown
Faa 6 studying in their hometown
Gaa 3 taken by the grandparents for full support
For purposes of taxable year 2017, how much total personal exemptions would Mirabella be entitled to?
Select
This one:
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a. P150,000
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b. P50,000
c. P175,000
d. P100,000

14. Ms. AC rented the vacant lot owned by Mr. X for a monthly rental of P10,000. The lease contract took effect on April
1, 2016 for a lease period of 25 years. The lessee, right after the consummation of the lease contract, constructed a
commercial building on the lot costing P6,000,000 with an estimated useful life of 50 years and a residual value of
P400,000. When the building was completed on January 1, 2017, the fair market value of the property was P8,000,000
per valuation made by the independent appraiser.

The building will become the property of the lessor after the expiration of the lease.

In addition, the annual property tax on the lot of P6,000 will be paid by the lessee. Using the outright method, the
taxable rent income for the year 2017 will be:

Select one:
a. P126,000
b. P8,126,000
c. P6,126,000
d. P94,500

15. Assume that Mr. A has P1,062,500 as his gross income. He is single and supports the following dependents:

His parents are both unemployed

His younger sister, 16 years old, single and unemployed, and
His elder brother, 30 years old, physically and mentally incapacitated The net taxable compensation income is:
Select one:
a. P912,500
b. P966,500
c. P936,500
d. P791,500

16. During the taxable year, Mr. Juan Dela Cruz separated legally from his wife, Andrea. The legally separated spouses
have four qualified dependent children. Both spouses were earning with the following gross taxable income: Mr. Juan
Dela Cruz, P380,000; Ms. Andrea, P250,000. For custody, the court granted Mr. Dela Cruz the two children and Ms.
Andrea the remaining two children. Meanwhile, Mr. Juan Dela Cruz is supporting his niece who is 21 years old,
unmarried, and not gainfully employed. Both spouses have monthly premium payment of P150 for health and insurance.
The allowable deduction for health and hospitalization insurance of Ms. Andrea is:
Select one:
a. P1,800
b. P3,000
c. Zero
d. P2,400

17. Ms. AC rented the vacant lot owned by Mr. X for a monthly rental of P10,000. The lease contract took effect on April
1, 2016 for a lease period of 25 years. The lessee, right after the consummation of the lease contract, constructed a
commercial building on the lot costing P6,000,000 with an estimated useful life of 50 years and a residual value of
P400,000. When the building was completed on January 1, 2017, the fair market value of the property was P8,000,000
per valuation made by the independent appraiser.
The building will become the property of the lessor after the expiration of the lease.
In addition, the annual property tax on the lot of P6,000 will be paid by the lessee.
Using the spread-out method, the taxable rent income for the year 2017 will be:
Select one:
a. P222,500
b. P190,500
c. P96,000
d. P254,000

18. This
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have four qualified dependent children. Both spouses were earning with the following gross taxable income: Mr. Juan
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Dela Cruz, P380,000; Ms. Andrea, P250,000. For custody, the court granted Mr. Dela Cruz the two children and Ms.
Andrea the remaining two children. Meanwhile, Mr. Juan Dela Cruz is supporting his niece who is 21 years old,
unmarried, and not gainfully employed. Both spouses have monthly premium payment of P150 for health and insurance.
The additional personal exemption of Mr. Juan Dela Cruz is:
Select one:
a. P75,000
b. P50,000
c. P25,000
d. Zero

19. Mr. B, a self-employed individual, presented the following data showing his business operation in 2017:
Sales P5,800,000
Sales return and allowances 150,000
Merchandise inventory,1/1/2017 1,200,000
Merchandise inventory,12/31/2017 1,800,000
Freight-in 80,000
Purchases 4,100,000
Purchase return and allowances 110,000
Freight-out 90,000
The gross taxable income during the current year is:
Select one:
a. 2,180,000
b. P2,330,000
c. P2,150,000
d. P2,090,000

20. The following properties were burned in a fire which broke out in the company premises:
Property I Property II
Type of loss Total loss Partial loss
Cost P800,000 P1,200,000
Accumulated Depreciation 500,000 600,000
Insurance claims 200,000 150,000
Replacement cost of damages - 500,000
The deductible loss on Property II is
Select one:
a. P1,200,000
b. P350,000
c. P500,000
d. P600,000

21. Mr. A received the following from his employer during the current taxable year:

Monthly basic salary, P45,000

Monthly representation and travelling allowance not subject to liquidation, P10,000
5% commission on net sales. Sales during the year were P6,300,000; sales return, P250,000
13th month pay, Christmas bonus and productivity pay amounting to 120% of his basic salary.
Assume that Mr. A is a widow with five qualified dependent children and had paid insurance premium for health and
hospitalization amounting to P4,000. The amount of net taxable compensation income will be:

Select one:
a. P691,500
b. P812,500
c. P836,500
d. P866,500

22. During the taxable year, Mr. Juan Dela Cruz separated legally from his wife, Andrea. The legally separated spouses
have four qualified dependent children. Both spouses were earning with the following gross taxable income: Mr. Juan
Dela Cruz, P380,000; Ms. Andrea, P250,000. For custody, the court granted Mr. Dela Cruz the two children and Ms.
Andrea thesource
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unmarried, and not gainfully employed. Both spouses have monthly premium payment of P150 for health and insurance.
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The filing status of Ms. Andrea is:
Select one:
a. Married
b. Head of the family
c. It's complicatd
d. Single

23. Ms. AC rented the vacant lot owned by Mr. X for a monthly rental of P10,000. The lease contract took effect on April
1, 2016 for a lease period of 25 years. The lessee, right after the consummation of the lease contract, constructed a
commercial building on the lot costing P6,000,000 with an estimated useful life of 50 years and a residual value of
P400,000. When the building was completed on January 1, 2017, the fair market value of the property was P8,000,000
per valuation made by the independent appraiser.
The building will become the property of the lessor after the expiration of the lease.
In addition, the annual property tax on the lot of P6,000 will be paid by the lessee.
Using the spread-out method of reporting income from leasehold improvement, the taxable rent income for the year
2016 will be:
Select one:
a. P222,500
b. P190,500
c. P96,000
d. P254,000

24. Mirabella's husband died in April 2016, leaving seven (7) unmarried children living with and wholly dependent on her
for chief support. The ages of the children are as follows:
Children Ages Status
Aaa 24 jobless
Baa 22 mentally retarted
Caa 19 studying in Manila
Daa 10 studying in their hometown
Eaa 8 studying in their hometown
Faa 6 studying in their hometown
Gaa 3 taken by the grandparents for full support
During the year, her income was P150,000. She also paid a total premium of P3,000 to an insurance company for his
health insurance. How much is his taxable income?
Select one:
a. P122,000
b. P97,600
c. P97,000
d. P122,600

25. During the taxable year, Mr. Juan Dela Cruz separated legally from his wife, Andrea. The legally separated spouses
have four qualified dependent children. Both spouses were earning with the following gross taxable income: Mr. Juan
Dela Cruz, P380,000; Ms. Andrea, P250,000. For custody, the court granted Mr. Dela Cruz the two children and Ms.
Andrea the remaining two children. Meanwhile, Mr. Juan Dela Cruz is supporting his niece who is 21 years old,
unmarried, and not gainfully employed. Both spouses have monthly premium payment of P150 for health and insurance.
Mr. Juan Dela Cruz is classified during the taxable year as:
Select one:
a. Single
b. It's complicated
c. Married
d. Head of the family

26. Which of the following is a deductible expense for income tax purposes?
Select one:
a. Salaries of personal household helpers
b. Repairs and maintenance of personal car
c. No correct answer
d. Provision for doubtful accounts
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27. Which of the following is a deductible interest expense
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 Select one:
a. Interest on personal indebtedness
b. Interest on tax delinquency
c. Interest on loan between members of a family
d. Interest on loan that was used to finance construction of the taxpayer's personal family home

28. In 2016, Pedro's wife died of a car accident. His dependents are as follows:
A, child, 22 years old, employed on July 12, 2016
B, child, 21 years old on November 2, 2016
C, child, 18 years old, married on January 31, 2016
D, child, 17 years old, gainfully employed on October 1, 2016
E, child, 15 afflicted with sore eyes on May 6, 2016
F, child, 13 died together with his wife in a car accident in 2016
G, sibling, 28 paralytic
For taxable year 2017, Pedro can claim additional exemptions of
Select one:
a. P100,000
b. P25,000
c. P 75,000
d. P125,000

29. Mirabella's husband died in April 2016, leaving seven (7) unmarried children living with and wholly dependent on her
for chief support. The ages of the children are as follows:
Children Ages Status
Aaa 24 jobless
Baa 22 mentally retarted
Caa 19 studying in Manila
Daa 10 studying in their hometown
Eaa 8 studying in their hometown
Faa 6 studying in their hometown
Gaa 3 taken by the grandparents for full support
For purposes of taxable year 2017, how much additional personal exemptions would Mirabella be entitled to?
Select one:
a. P175,000
b. P100,000
c. P150,000
d. P50,000

30. The following properties were burned in a fire which broke out in the company premises:
Property I Property II
Type of loss Total loss Partial loss
Cost P800,000 P1,200,000
Accumulated Depreciation 500,000 600,000
Insurance claims 200,000 150,000
Replacement cost of damages - 500,000
The deductible loss on Property I is
Select one:
a. P50,000
b. P600,000
c. P250,000
d. P800,000

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