Objective/s from the Module

1. Determine overall considerations in the rationale, basis and computation of the various percentage taxes

2. Distinguish business transactions as to percentage tax

3. Apply the concept of VATposed

Test Items

Compute for the needed data. Prepare journal entries for each computation.

Anton Co operates a cockpit in Pampanga. There is also a cafe inside the cockpit which he also operates. The data during the month are as follows:

Gross receipts from the gatesPhp 390, 000

Receipts from advertisements

Inside the cockpit arena 15, 000

Gross receipts from the caf:

Sale of food and beverages 21, 000

Sale of liquor 33, 000

Disbursements (subject to VAT) 24, 200

Disbursements (not subject to VAT) 12, 000

Compute for the following:

A. amusement tax due

B. business tax due if the caf is owned and operated by Moshe, a non-VAT registered individual

C. the percentage tax due on Anton supposed that the caf is operated by Moshe

D. business tax payable by Moshe assuming that he is a VAT registered taxpayer operating the caf.

Computations:

A.

Gates Php 390, 000

Advertisements Php15, 000

Food and beverages Php21, 000

Liquor Php33, 000

Gross Receipts Php 459, 000

Rate of tax 18 %

Amusement tax Php82, 620

B.

Sale of food and beverages Php 21, 000

Sale of liquor Php 33, 000

Gross receipts Php 54, 000

Rate of tax 3 %

Percentage tax Php1, 620

C.

Gross receipts from gates Php 390, 000

Advertisements Php15, 000

Gross receipts Php 405, 000

Rate of tax 18 %

Amusement tax Php72, 900

D.

Output tax (21, 000 + 33, 000) x 12 % Php 6, 480

Less: Input tax (24, 200 x 12 %) 2, 904

VAT payable Php 3, 576