RIGHT OR WRONG For taxation purposes, the house and lot as family home of taxpayer is his ordinary asset. When inventory of goods are sold at price lower than cost, the seller has capital loss. When production machine of the business is sold at a mark up on cost, the seller has ordinary business income. When personal valuable necklace of the taxpayer is stolen, the taxpayer has capital loss.
RIGHT OR WRONG
- For
taxation purposes, the house and lot as family home of taxpayer is his ordinary asset. - When inventory of goods are sold at price lower than cost, the seller has capital loss.
- When production machine of the business is sold at a mark up on cost, the seller has ordinary business income.
- When personal valuable necklace of the taxpayer is stolen, the taxpayer has capital loss.
Capital gain tax is an income tax.- The mark up on the sale of an equipment used in business activities is reportable in 1701 tax return of the sole owner of such business.
7. The sole proprietor sold for P500,000 its inventory with carrying cost of P400,000. The sale will result to
BUSINESS INCOME OF 100k
CAPITAL GAIN OF 100k
BUSINESS INCOME OF 500k
CAPITAL GAIN OF 500k
8. The investment in bond was sold by the resident citizen at mark up of P200,000 on carrying cost. If the bond has maturity of 5 years, the mark up on cost is
EXEMPT FROM INCOME TAX
TAXABLE INCOME
BUSINESS INCOME
ORDINARY INCOME
9. X is holder of 100,000, P10 par/share in family corporation. He executed deed of assignment of ownership of the 100,000 shares in favor of his son when the book value per share was P20. How much is the taxable capital gain in the above transaction?
1M
2M
200K
NONE
10. X corporation issued its 50,000, P100 par shares to share hoLders of Y in exchange for the 80% ownership in Y. At exhange date Y's fair value was P6,000,000 and X's share was selling at P105/share. At point of view of X, the exchange wil result to its
CAPITAL GAIN OF 450K
ORDINARY INCOME OF 450K
CAPITAL LOSS OF 450K
CAPITAL GAIN OF 750K
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