21.Which of the following is NOT income tax exempt?*

BOI-registered enterprise enjoying tax holiday

Forex transaction income of a Foreign Currency Depositary Unit from another Foreign Currency Depositary Unit

Forex income in the Philippines of an Offshore Banking Unit

Regional area headquarter of a multinational company

None of the Above

22.Which of the following will not require reporting of taxpayer's income on a calendar basis?*

If the taxpayer is a corporation operating in a fiscal year;

If the taxpayer does not keep books of accounts;

If the taxpayer has no annual accounting period;

All of the above

23.Which statement is FALSE?*

Interest income earned by a depositary bank under the Expanded Foreign Currency Deposit System from residents is subject to 10% final income tax.

A PEZA-registered enterprise is non-taxable on its related activities.

The income of an Offshore Banking Unit from forex transactions in the country is subject to regular income tax.

None of the above

All of the above

24.During the audit conducted by the BIR official, it was found that the rental income claimed by the corporation was not subjected to expanded withholding tax. Accordingly, the claimed rental expense:*

Is deductible from the gross income of the corporation, despite non-withholding of income taxby the corporation

Is deductible, if it can be shown that the lessor has correctly reported the rental income in his tax return.

Is not deductible from gross income of the corporation due to non-withholding of tax;

Is deductible from the gross income of the corporation, provided that the 5% expanded withholding tax is paid by the corporation during the audit;

25.Identify a CORRECT statement:*

Government owned and controlled corporations are tax exempt on their income as such.

A government unit engaged in profit-oriented activity is taxable on its income from said activity.

Purchases of goods and services of non-stock and non-profit corporations are exempted from VAT.

All of the above

None of the above

26.Which of the following should not be claimed as deductions from gross income?*

interest payment on loans for the purchase of machinery and equipment used inbusiness.

salaries and bonuses paid to employees.

discounts given to senior citizens on certain goods and services.

advertising expense to maintain some form of goodwill for the taxpayer's business.

27.Which corporation is not an exempt corporation?*

Government-owned and Controlled Corporation

Social Security System

Home Development Mutual Fund

Philippine Health Insurance System

28.XYZ is a religious corporation duly registered as such. BIR assessed income tax on its income from several properties leased out to various tenants. XYZ contested the assessment and argued that the rental income should be tax exempt because it is used by the corporation in its religious activities. DECIDE.*

The rental income is tax exempt because it is used for religious purposes.

The rental income is tax exempt because the corporation is a non-stock and non-profit corporation.

The rental income is taxable because it is derived from an activity conducted for profit regardless of whether it is used for the purpose of the corporation or not.

The rental income is taxable if the tenants are non-members of the church.

29.The income tax due is P1,000. What is the compromise penalty on filing of an income tax return with the wrong RDO?*

P500

P1,000

P2,000

P5,000

30.St. Therese is a private educational institution. STATEMENT 1: The income of the school from tuition and miscellaneous fees collected from students is tax-exempt. STATEMENT 2: The income of the school from rentals of its facilities to non-students is subject to regular income tax.*

True, True

False, False

True, False

False, True