Taxation Straight Problem No. 10: GFRIEND

Since malapit na ang board exam, try ninyong i-solve ang problems para maassess kung handa ka nang mag-take ng CPA Board Exam this October. Solve these problems:


First Problem

Last August 23, GFRIEND held its 2019 tour called “Go Go GFRIEND” at Manila:

Discussion Questions

  1. For income tax purposes, what will be the taxability of GFRIEND?
    1. Resident citizens
    2. Resident aliens
    3. Non-resident aliens engaged in business
    4. Non-resident aliens not engaged in trade or business.
  2. On what type GFRIEND will be subject to income tax, and who will withhold the tax due (if applicable)?
    1. Graduated tax rate or 8%, at GFRIEND’s option; Source Music
    2. Graduated tax rate; local promotion agency
    3. 25% of gross income; local promotion agency
    4. 25% of gross income; Source Music

Second Problem

Assume that Eunha is engaged in business of selling height-growth products in Philippines. These products are sold in a continuous basis. She only visits the country monthly or quarterly to check on status of business.

Discussion Questions:

  1. For income tax purposes, what will be Eunha’s status? (Choose one)
    1. Resident citizen
    2. Resident alien
    3. Non-resident alien engaged in business
    4. Non-resident alien not engaged in trade or business.
  2. Assume that her products are VATable. Explain the tax effects of her products, assuming that she is VAT-registered:
    1. Input VAT
    2. Output VAT

Taxation Problem created by: TweetNewscaster