College of Accounting Education

3nd Floor, Dr. Florencio T. Facundo Hall, Business

& Engineering Bldg., Matina, Davao City
Phone No.: (082)300-5456 Local 137

ACC 311 (Income Taxation)

Practice Competency Exam

GENERAL INSTRUCTIONS
1. In this task, you are expected to demonstrate your skill in preparing the annual income tax return for
individual taxpayers using the manual filing system on the questionnaire provided by the subject
teacher. For you to accomplish this, your knowledge and ability to compute the relevant tax is
imperative.
2. Download, print and read the contents, including the guidelines and instructions of BIR Form 1701
(Annual Income tax Return for Individual Taxpayers). You will be given a problem related to the
computation of income tax for individual taxpayer. Your task is to compute the income tax payable of
the taxpayer and fill the necessary information in the income tax return.
3. You will be graded for the tax return prepared according to the manual tax return preparation rubric.

EVALUATION RUBRIC – Manual Tax Return Preparation

Category Unacceptable = Fair = 2 Good = 3 Excellent = 4 Weighted Total

1 Total Score Points
Tax Return Correct entries Correct entries Only one entry Correct and __ x 1 = __ 4
Information are less than are at least lacking or complete data
50% of required 50% of incorrect entries
data required data
Taxpayer’s Correct entries Correct entries Only one entry Correct and __ x 2 = __ 8
Information are less than are at least lacking or complete data
50% of required 50% of incorrect entries
data required data
Computation Incorrect tax Correct tax due Correct tax due Correct tax due __ x 3 = __ 12
of Tax due and/or and tax and tax payable and tax payable
incorrect tax payable (overpayment) (overpayment)
payable (overpayment) with only one with complete
(overpayment) but with entry lacking or and correct
multiple entry incorrect data entries
errors
Supporting Correct entries Correct entries Only one entry Correct and __ x 2 = __ 8
Schedules are less than are at least lacking or complete data
50% of required 50% of incorrect entries
data required data
Signatory Correct entries Correct entries Only one entry Correct and __ x 1 = __ 4
and other are less than are at least lacking or complete data
information 50% of required 50% of incorrect entries
data required data
Presentation Hard to read Comprehensive Comprehensible Comprehensible __ x 1 = __ 4
entries entries but entries but with entries with no
with more than 1-2 erasures erasure
2 erasures
TOTAL 40
 College of Accounting Education
3nd Floor, Dr. Florencio T. Facundo Hall, Business
& Engineering Bldg., Matina, Davao City
Phone No.: (082)300-5456 Local 137

PROBLEM
The following information relate to you for 2023 taxable year:
1. Name of taxpayer Your Name
Address Manuel Morales Bldg., J.P. Laurel Avenue, Bajada, Davao
City
TIN 123-456-789-000
Telephone Number 644-2340
Date of birth Your birthday
RDO Code: 132

2. Income of the taxpayer from business:

Trade Name “Your Family Name” Hardware
TIN 330-898-767
Method of accounting Accrual system
Method of deduction Itemized
Tax Rate Graduated Rates

a. Compensation Income from Employment - P450,000

SSS/PHIC/HDMF Contribution - 25,000
Tax w/held - 13,050

b. Data on business operation:

Sales P4,500,000
Sales discounts and returns 25,000
Merchandise inventory, January 1 684,000
Purchases 3,100,000
Purchases returns and discounts 24,000
Merchandise inventory, December 31 1,250,000
Salaries and wages 320,000
Light and water 21,000
Depreciation 14,500
Taxes and licenses 7,000
Gasoline and oil 20,100
Maintenance of motor vehicle 10,500
Supplies 14,050
Advertising 13,000
Quarterly Income tax paid 29,800