1.

Three inherent powers of the state

2. It is not only the power to destroy but it is also the power to keep alive.

3. Tax is a not a pecuniary burden

4. Escape from taxation using permissible way.

5. Other term for tax evasion.

6. “When a child or descendant has been found guilty of an attempt against the life of the testator, his or
her spouse, descendants, or ascendants”
The statement is a valid cause for disinheritance.

7. “The refusal to support the children or descendants without justifiable cause.”

The statement is not a valid cause for disinheritance.

8. One of the following donations is not included as part of gross estate

a. Revocable transfers
b. Transfers with reservation of certain rights
c. Transfers under special power of appointment
d. Transfers in contemplation of death
9. Which of the following transfer is not included in the gross estate?
a. Transfer with reservation of certain rights
b. Transfer for insufficient consideration
c. Transfer for an adequate and full consideration in money or money's worth
d. Transfer in contemplation of death

10. The gross estate of a decedent who was married at the time of death will be composed of:
a. His capital property, the wife's paraphernal property and the common property
b. His capital property and the common property
c. Common property
d. His capital property
11. One of the following is a conjugal property of the spouses
a. That which is brought to the marriage as his or her own
b. That which each acquires during the marriage by inheritance
c. The fruits of an exclusive property
d. That which is purchased with the exclusive property of the wife

12. One of the following is not a community property of the spouses

a. Property inherited by the husband before marriage
b. Winnings in gambling
c. Fruits of property inherited during the marriage
d. Fruits of property inherited before the marriage
13. Properties owned by the spouses before and brought into the marriage shall be classified
as:
Absolute Community Property Conjugal Partnership of Gains
a. Community Conjugal
b. Exclusive Exclusive
c. Community Exclusive
d. Exclusive Conjugal

14. Properties received from gratuitous transfer during marriage where the donor or testator
expressly provides that it shall form part of the common property of the spouses shall be
classified as:
Absolute Community Property Conjugal Partnership of Gains
a. Community Conjugal
b. Exclusive Exclusive
c. Community Exclusive
d. Exclusive Conjugal
15. The following are the requisites for vanishing deduction to be allowable, except one.

a. The estate tax of the prior succession must have been finally determined and paid.
b. The present decedent died within five (5) years from date of death of the prior decedent
c. The property with respect to which deduction is sought can be identified as having been
received by the present decedent from the prior decedent.
d. None of the above
16. The following statements are correct regarding standard deduction under the TRAIN LAW,
except:
a. A deduction in the amount of P5,000,000 shall be allowed as an additional deduction
without need of substantiation.
b. The full amount of shall be allowed as deduction for the benefit of the decedent.
c. Standard deduction is not allowed to decedents who are non-resident aliens.
d. None of the above
17. One of the following is allowed as a deduction from the gross estate of a non-resident alien
decedent who died on or after January 1, 2018, but is prorated between Philippine gross
estate and the total or world gross estate:
 a. Losses, indebtedness, taxes, etc.
b. Share of the surviving spouse
c. Vanishing deduction
d. Amount received under R.A. 4917

18. In computing the estate tax, which of the following shall not be allowed tax credit for taxes paid
abroad?
a. Resident alien decedent
b. Non-resident alien decedent
c. Resident citizen decedent
d. Non-resident citizen decedent
19. Ordinary deductions
20. Special Deductions
21. Statement 1: The gift is perfected from the moment of the donor effects the delivery either actually or constructively
of the property donated.
Statement 2: Donor’s tax is a property tax imposed on the property transferred by way of gift inter vivos.
a. True, True c. False, True
b. True, False d. False, False

22. Which is not true about donation between spouses?

a. Husband and wife cannot donate any conjugal or community property without the consent of the other
b. Husband and wife may make a joint donation of conjugal or community property
c. In a joint donation of conjugal or community property, each spouse shall be considered a separate donor of his or her
interest in the property
d. When a spouse makes moderate donations for charity or on occasions of family rejoicing or family distress, the consent
of the other spouse is needed.
23. Statement 1: In order that the donation of an immovable property may be valid, it must be made in public instrument
specifying therein the property donated.
Statement 2: General renunciation of the heir, including the surviving spouse, of his or her share in the hereditary estate left
by the decedent is not subject to donor’s tax.
a. Both statements are false
b. 1st statement is false while 2nd statement is true
c. 1st statement is true while 2nd statement is false
d. Both statements are true
24. At the testimonial dinner for new CPAs, Christian was requested to sing the theme song of the movie “Ghost”. Mae
was so delighted that she feels she is falling in love with Christian, so she decided to cancel Christian’s indebtedness to
her. As a result,
a. Christian realized a taxable income as compensation for services.
b. If Christian accepts the cancellation, he will pay donor’s tax.
c. Christian received a gift from Mae and therefore not part of his taxable income.
d. The amount of indebtedness cancelled is partly taxable, and partly exempt.
25. Donation of bag worth P50,000 in a public instrument is not valid.
26. Elements of donation
27. One of the following statements is false:
a. Contracts of donation between husband and wife are void in all cases.
b. The donation by Chavit to President Aquino in view of his public office is void.
c. Donations between persons guilty of adultery or concubinage are void.
d. Donations to conceived or unborn children are valid.
28. All of the following are exempt from gift tax under special laws, except one:
a. Donation to the Integrated Bar of the Philippines
b. Donation to the Development Academy of the Philippines
c. Donation to Philippine Institute of Certified Public Accountants
d. Donation to International Rice Research Institute
29. Encumbrance assumed by the donor is one of the allowable deductions in the gross gift.
30. Diminution provided by the donor is one of the allowable deductions in the gross gift.
31. Renumeratory donation is subject to donor’s tax.
32. Stateless person who resided in the Philippines cannot claim donor’s or estate tax credit.
33. Intnagible Personal Property is always subject to donor’s or estate tax if is owned by a stateless person not residing in
the Philippines without considering whether or not there is reciprocity.
34. If the donee should commit some offense against the person, the honor or the property of the donor, or
of his wife or children under his parental authority;
The donation cannot be revoked at the instance of the donor, by reason of ingratitude
35. A VAT-registered taxpayer treated the excess of output VAT over input VAT as expense
and was shown in the Statement of Income and Expenses. Is it the proper treatment of
VAT?
A. Yes. VAT is treated as expense and is properly shown in the Statement of
Income and Expenses.
B. No. VAT payable is considered as current liability and must be shown in the
Statement of Financial Condition.
C. Yes. But the taxpayer has the option to show it in the Statement of Financial
Condition if it is favorable to him.
D. No. There is no clear rule on how to treat VAT payable.

36. One of your clients sells roasted chicken and canned fish. During 2018, his gross sales
are as follows:

Gross sales, roasted chicken ₱ 1,750,000

Gross sales, canned fish 3,919,500

He wants to know if he is subject to VAT. He has not registered yet under VAT system. What
will your answer be?
a. He is subject to VAT because his total sales exceeded the VAT threshold
amount.
b. He is not subject to VAT because he sells chicken and fish in their original state.
c. He is subject to VAT because the canned fish is no longer in its original state
and the gross sales exceed the VAT threshold amount.
d. He is not subject to VAT because he is not VAT- registered.
37. Mr. Sio Pao, a manufacturer of dimsum products to its customers, had the following
transactions during the month:

I- Sold its dimsum products to customers.

II - Due to excess funds, Mr. Sio Pao invested in the shares
of stock of MSC, a domestic corporation that is listed
and traded in the stock exchange, and
sold them during the same month to Ms. Sio Mai.
III - Mr. Sio Pao sold his family home.
 Which of the following statements (is) are true?
a. Only one of the transactions is subject to business tax
b. Only two of the transactions are subject to business tax
c. All three transactions are subject to business tax
d. None of the transactions are subject to business tax
38. 3 Classifications of Zero Rated Sale

39. Mr. Kudos, a VAT-registered lawyer, had a residence with a zonal value of P2,000,000
and assessed value of P1,500,000. The same was foreclosed by a bank for his failure to
pay his bank loan.

What would be the output VAT on the foreclosure of the property?

a. None, because the same is a capital asset
b. None, because the same is below the threshold on residential dwellings
c. P 240,000, because the deemed sales is based on fair value
d. P 180,000, because deemed sales on foreclosure sales is based on the lower of cost or fair
value
40. A manufacturer of perfume oils which newly registered as VAT taxpayers during the
quarter shall not be allowed which of the following?
a. Transitional input VAT
b. Presumptive input VAT
c. Regular input VAT
d. None of these