Scribd
Upload
69 views

Inbutax 5

The document contains multiple choice questions related to taxation. It asks about topics like treatment of bad debts recovered, separation pay for retrenched employees, capital expenditures, tax credits for foreign taxes paid, casualty losses, carry forward of net operating losses, and computation of deductible losses.

Uploaded by

Kim Edward Tenorio
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
69 views

Inbutax 5

The document contains multiple choice questions related to taxation. It asks about topics like treatment of bad debts recovered, separation pay for retrenched employees, capital expenditures, tax credits for foreign taxes paid, casualty losses, carry forward of net operating losses, and computation of deductible losses.

Uploaded by

Kim Edward Tenorio
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 2

30.

Any amount subsequently received on account of a bad debt previously charged off and allowed as a
deduction

from gross income in prior years must be included in gross income in the taxable year in which received.
This is

a. Severance test c. Destination of income test

b. Life-blood theory d. Equitable doctrine of tax benefit

31. INIWAN, a dedicated and honest employee of PAASA Corp. For the past 20 years was advised that he
is to be

retrenched as the company was losing heavily but that he would be given the separation pay provided
by law.

To avoid implication of inefficiency INIWAN was advised to file a letter of resignation instead of being

retrenched. If INIWAN files a letter of resignation and receives the separation pay, such amount is

a.Taxable in full c. Exempt from income tax

b.Partly taxable, partly exempt d. Subject to final tax

32. Using the preceding no. If INIWAN is retrenched and receives the separation pay, such amount is

a. Taxable in full c. Exempt from income tax

B.Partly taxable, partly exempt d. Subject to final tax

33. May consider capital expenditures as revenue expenditures

a.Resident citizen c. Private educational institutions

b.Domestic corporation d. Resident alien

34. May claim tax credit for income taxes paid to foreign country

a.Resident citizen c. Non-resident citizen

b.Resident alien d. Non-resident alien

35. A building was partially destroyed by fire in 2018. The building had a book value of P5M the
insurance company

was willing to pay 4M, which was refused by the owner. Finally, the claim was settled in 2020 for P4.6M.
the

proceeds will be

a. Exempt from income tax c. Subject to final tax

/etd

b. Part of taxable income d. Partly exempt, partly taxable


36. One of the following is not correct for deductibility of losses from gross income

a. Must arise from fire, storm or other casualty, robbery, theft or embezzlement

b. Must not be compensated by insurance or other form of indemnity

c. A declaration of loss by casualty should be filed with the Bureau of Internal Revenue

d. Must have been claimed as deduction in the estate return of the taxpayer

37. The net operating loss, which had not been previously offset as deduction from gross income shall
be carried

over as deduction from gross income for the next

a. 2 consecutive taxable years immediately following such loss

b.3 consecutive taxable years immediately following such loss

c. 4 consecutive taxable years immediately following such loss

d.Taxable year immediately following such loss

38-39

A taxpayer engaged in business incurred a partial loss of property as follows:

Asset 1 Asset 2

Book value of the asset at the time of loss P200, 000 P200,000

Cost to restore the property back to its normal operating condition 120,000 300,000

Insurance Recovery 50, 000 None

Salvage none 40, 000

38. The deductible loss for asset 1 is

a. P120, 000 b. P170, 000 c. P30,000 d. P80,000

39. The deductible loss for asset 2 is

a. P300, 000 b. P40, 000 c. P160,000 d. P240,000

You might also like