a. Rosales Corporation, a domestic corporation, adopted Masbate State College, a school operated by the

government and accredited by CHED. It entered into a Memorandum of Agreement (MOA) with the

provincial school and CHED. Rosales Corporation provided the following assistance:

Cash to improve school facilities P500,000

Computers (acquisition cost) 500,000

The following data were taken from the books of Rosales Corporation for the current year:

Gross income P10,000,000

Operating expenses (excluding the assistance ) 3,000,000

Question 1 - How much is the amount deductible by Rosales Corporation as far as the assistance to a

public school is concerned?

Question 2 - How much is the taxable net income of Rosales Corporation?

b. Aranas Corporation has a soft spot for senior citizens and PWDs. As such, it hires senior citizens and

PWDs to work in the company for at least six (6) months. The following data are provided by the

corporation:

Gross sales P15,000,000

Cost of sales 5,000,000

Operating expenses (including salaries of P500,000 given

to senior citizen-employees and P200,000 given to PWDs) 3,000,000

During the same period the corporation also allows 20% discount to senior citizens who buy goods from

the company. The discount is on the P800,000 sales (part of the gross sales above) summarized as

follows:

Selling price (VAT-exempt) P800,000

Less: 20% discount 160,000

Amount payable by the Senior Citizen P640,000

Question 1 - How much is the special itemized deductions allowed in connection with the salary of the

senior citizen-employee and PWDs and the discount given to senior citizens?

Question 2 - How much is the taxable net income of the corporation?

Question 3 - How much is the taxable net income of the corporation availing of OSD?

c. A VAT-registered enterprise sold goods to a person with disability. The amount of sale was P1,000,

without VAT.

Question 1 - How much is the sales discount that can be deducted from the gross income of the seller?

Question 2 - How much is the total amount to be paid by the person with disability?

d. Health Care Services, a private health institution, complies with Rooming-in and Breast-Feeding Practices

as provided under R.A. 7600. It holds a seminar on the advantage of breastfeeding. The following duly

receipted expenses are incurred in connection with the seminar:

Materials on breast-feeding P300,000

Transportation expense 100,000

Free snacks 50,000

Total P450,000

How much is the total deductible amount including the special itemized deduction?

e. Tamayo Lim Caiga Manuel and Associates, a partnership of lawyers, renders 500 hours of pro bono legal

assistance to indigent litigants. The 500 hours do not include the 60 hours mandatory legal aid required

by Supreme Court. The partnership charges P10,000 per hour to paying clients. The partnership's gross

income during the year amounts to P80,000,000.

How much is the allowable special itemized deduction that the firm can deduct from its gross professional

fees?