3/8/2019 Prelims

Question 1 Tax avoidance is the use by the tax payer of legal or fraudulent means to avoid or defeat taxes
Not yet
answered
Select one:
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a. True, true

b. False, true

c. False, false

d. True, false

Question 2 Which of the following statements is correct?

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answered
Select one:
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a. Income tax is indirect tax
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b. One of the nature of taxation is the reciprocal duties of protection and support between state

c. Every sovereign government has the inherent power of tax

d. The president is authorized to increase or decrease national internal revenue taxes rate

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3/8/2019 Prelims
Question 3 Statement 1: an ordinance imposing a tax on the manufactures of soft drinks and another tax on the sale of the soft drinks
Not yet constitute double taxation.
answered
Statement 2: A criminal case for tax evasion maybe filled against taxpayers even without prior assessment issued by the
Marked out of
1.00 Commissioners of Internal Revenue.
Which of the following statement is false?

Select one:
a. Statement 2: A criminal case for tax evasion maybe filled against taxpayers even without prior assessment
issued by the Commissioners of Internal Revenue only.

b. Neither the given choices are correct

c. Statement 1: an ordinance imposing a tax on the manufactures of soft drinks and another tax on the sale of
the soft drinks constitute double taxation only.
d. Both of the given choices are correct

Question 4 Which of the following does not fall within the powers and duties of the Bureau of Internal Revenue?
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answered
Select one:
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a. To execute judgments in all cases decided in its favor by the Court of Tax Appeals and the ordinary courts.
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b. To assess and collect all national internal revenue taxes, fees, and charges.

c. To summon, examine and take testimony of persons.

d. To enforce all forfeitures, penalties, and fines connected with the assessment and collection functions.

Question 5 The aspects of taxation are

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Select one:
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a. Legislative in character

b. Judicial in character

c. Executive in character
d. Shared by the legislative and executive departments.

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3/8/2019 Prelims
Question 6 I. The power of taxation is inherent in sovereignty being essential to the existence of every government. Hence, even if not
Not yet mentioned in the Constitution the state can still exercise the power and is essentially a legislative function.
answered
II. Even in the absence of any constitutional provision, taxation power falls to Congress as part of the general power of law-
Marked out of
1.00 making

Select one:
a. True, false

b. False, true
c. True, true
d. False, false

Question 7 The taxable income of Ms. Lee is:

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answered
Select one:
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a. P188,200
b. P240,000

c. P165,000

d. P190,000

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3/8/2019 Prelims
Question 8 Saint Anthony College (SAC) is non-stock, non-profit educational institution. It owns a 5 hectares lot one half of which is being
Not yet used as its school campus while the other half is vacant. To cope with the increasing operating costs and to upgrade its
answered
facilities, SAC plans to do the following effective January 1, 2017:
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1.00 (1) Rent out to a marketing firm the vacant portion of the lot.
(2) Increase tuition fees by 10% in accordance with government regulations: and
(3) Import 20 sets of computers for use in its computer courses.
Which of the following is answerable by "yes"

Select one:
a. Is SAC subject to real estate tax one-half portion to be rented out to the business establishment?

b. Will it subject to customs duties on the importation of the computers?

c. Will the increase in tuition fees be subject to income tax, if it results to a net income from school operation?
d. Will it be exempt from income tax on its rental to the marketing firm?

Question 9 The taxable income of Mr. Dy is:

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answered
Select one:
Marked out of
a. P280,000
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b. P255,000

c. P278,200

d. P253,200

Question 10 Taxation as distinguished from police power and power of eminent domain.
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Select one:
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a. Property is taken to promote the general welfare
b. Maybe exercised only by the government

c. There are generally no limits as to the amount that may be imposed

d. Operates upon the whole citizenry
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3/8/2019 Prelims
Question 11 Which of the following statement is wrong? A revenue bill:
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answered
Select one:
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a. Must originate from the House of Representative and on which same bill Senate may propose amendments:
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b. May have a House version and a Senate version approved separately, and then consolidated, with both
houses approving the consolidation version.

c. May be recommended by the President Congress.

d. May originate from the Senate and on which same bill the House of Representatives may propose
amendments:

Question 12 I. The property taken in police power is destroyed while the property taken under the power of eminent domain and power of
Not yet taxation are not destroyed.
answered
II. In power of taxation, the compensation received is the protection afforded to the citizens: in police power the compensation
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1.00 received is the altruistic feelings that somehow you contributed to the promotion of the general welfare: in power of eminent
domain, the compensation received is the just compensation paid for the property taken.

Select one:
a. False, false

b. True, true

c. True, false

d. False, true

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3/8/2019 Prelims
Question 13
Not yet
answered

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If it is a domestic corporation, its income tax is _____.

Select one:
a. P450,000

b. P675,000

c. P825,000

d. 480,000

Question 14 Basic principles of sound tax system except:

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answered
Select one:
Marked out of
a. Administrative feasibility
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b. Fiscal adequacy

c. Equality or theoretical justice

d. Intellectual sensitivity

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3/8/2019 Prelims
Question 15 The allowable deductions for health and hospitalization insurance of Mr. Dy is:
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answered
Select one:
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a. No correct answer
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b. P1,800
c. P2,400d

d. P13,800

Question 16
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answered

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The MCIT would be:

Select one:
a. P150,000
b. P P70,000

c. P60,000
d. P90,000

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3/8/2019 Prelims
Question 17 The president of the Philippines and the Prime minister of Japan centered into executive agreement in respect of a loan
Not yet facility to the Philippines from Japan whereby it was stipulated that interest on loans granted by private Japanese financial
answered
institution in the Philippines shall not be subject to Philippine income taxes. What basic characteristic of taxation has been
Marked out of violated by this agreement?
1.00

Select one:
a. Administrative feasibility

b. Theoretical justice

c. Inherent limitation
d. Legislative in character

Question 18 Which is not an essential characteristic of a tax?

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answered
Select one:
Marked out of
a. It is proportionate in character
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b. It is enforced contribution

c. It is payable in money
d. It is unlimited as to amount

Question 19 I. The power of taxation is inherent in sovereignty being essential to the existence of every government. Hence, even if not
Not yet mentioned in the Constitution the state can still exercise the power and is essentially a legislative function.
answered
II. Even in the absence of any constitutional provision, taxation power falls to Congress as part of the general power of law-
Marked out of making
1.00

Select one:
a. False, True
b. True, False

c. False, False
d. True, True

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3/8/2019 Prelims
Question 20 The allowable deductions for health and hospitalization insurance of Mr. Dy is:
Not yet
answered
Select one:
Marked out of
a. P13,800
1.00
b. No correct answer
c. P1,800
d. P2,400

Question 21 The principal purpose of taxation is.

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answered
Select one:
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a. To implement the police power of the state
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b. To encourage the growth of home industries through the proper u se of tax exemptions and tax incentives.

c. To raise revenues for governmental needs.

d. The reduce excessive inequalities of wealth

Question 22 Which of the following is not within the power of the Commissioner of Internal Revenue to make an assessment?
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answered
Select one:
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a. Examination of income tax returns and determination of tax due

b. Compromise tax cases

c. Inquire into bank deposit accounts.

d. Conduct inventory taking and surveillance

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3/8/2019 Prelims
Question 23 This is an inherent limitation on the power of taxation
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answered
Select one:
Marked out of
a. Tax must be for public purpose
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b. Due process of law and equal protection of the laws
c. Rule on uniformity and equity in taxation

d. Non-impairment of the jurisdiction of the supreme court in tax cases

Question 24 The Commissioner of Internal Revenue cannot

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answered
Select one:
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a. Compromise criminal aspect of tax violations if already filed in court
b. Abate tax liability

c. Compromise payment of internal revenue taxes

d. Credit or refund taxes erroneously or illegally collected

Question 25 As to scope of the legislative power to tax, which is not correct?

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answered
Select one:
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a. The sole arbiter of the purpose for which taxes shall be levied is Commissioner of Internal Revenue (CIR)
provided the purpose is public but the courts may review the levy of the tax to determine whether or not the
purpose is public.
b. In the absence of any constitutional prohibition, the House of the Representatives has the right to levy a tax of
any amount it sees fit

c. The discretion of congress in imposing taxes extends to the mode, method or kind of tax, if not restricted by
the constitution
d. Where there are no constitutional restrictions, and provided the subjects are within the territorial jurisdiction
of the state, congress has unlimited discretion as to the persons, property or occupation to be taxed

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3/8/2019 Prelims
Question 26 Enforced proportional contributions from person and property levied by the state by virtue of its sovereignty for the support of
Not yet the government and for all public needs.
answered

Marked out of Select one:

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a. Toll

b. License fee

c. Assessment
d. Taxes

Question 27
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answered

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Moreover, the company had an excess tax payment of P12,500 in 2016 from which it had decided to claim tax credit on the
excess.
The income tax due at the end of second quarter

Select one:
a. P75,600
b. P31,800

c. P26,000

d. P28,320

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3/8/2019 Prelims
Question 28 The power to interpret the provisions of the National Internal Revenue Code shall be under the exclusive and original
Not yet jurisdiction of the
answered

Marked out of Select one:

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a. Secretary of Finance

b. Commissioner of Internal Revenue

c. Court of Tax Appeals
d. Supreme Court Justice

Question 29
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answered

Marked out of
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The income tax to be paid, if the company opted to use the OSD is:

Select one:
a. P810,000

b. P90,000

c. P510,000

d. P0

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3/8/2019 Prelims
Question 30
Not yet
answered

Marked out of
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Moreover, the company had an excess tax payment of P12,500 in 2016 from which it had decided to claim tax credit on the
excess.
What is the income tax still payable at the end of first quarter?

Select one:
a. P21,500

b. P40,800
c. P36,720

d. P28,300

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