Theories on Taxation
-------------------------------------------------
TAXATION August 2011
Multiple Choice. Identify the letter of the choice that best completes the statement or answers the question.
1. Which of the following is not subject to tax as a corporation? (A) Business partnerships. (B) Insurance companies. (C) Joint stock companies. (D) General professional partnership. 2. A partnership formed by persons for the sole purpose of exercising their common profession, no part of the income of which is derived from engaging in any trade or business. (A) Joint venture. (B) Trading partnership. (C) General professional partnership. (D) Joint accounts. 3. Which of the following is a general professional partnership? (A) Partnership organized by a lawyer, engineer and a CPA to provide professional advice. (B) A partnership organized by a group of CPAs for the common practice of accountancy. (C) A partnership organized by a group of CPAs for the purpose of selling real properties. (D) General partnership organized by group of engineers engaged in manufacturing of equipment. 4. Which of the following statements is most correct? Statement 1. For purposes of computing the distributive share of the partners, the net income of the partnership shall be computed in the same manner as a corporation. Statement 2. Each partner shall report as gross income his distributive share, actually or constructively received, in the net income of the partnership. (A) Statement 1 only. (B) Statement 2 only. (C) Both statements are correct. (D) None of the above. 5. Which of the following statement is most correct? (A) The tax imposed on corporations is not imposed only upon such corporations as are organized and operated for profit. (B) A corporation, firm or association, no matter how created or organized, or what the purpose of its organization may be, is subject to tax, except as provided in Sec. 30, relative to the exemptions
TAXATION August 2011
Multiple Choice. Identify the letter of the choice that best completes the statement or answers the question.
1. Which of the following is not subject to tax as a corporation? (A) Business partnerships. (B) Insurance companies. (C) Joint stock companies. (D) General professional partnership. 2. A partnership formed by persons for the sole purpose of exercising their common profession, no part of the income of which is derived from engaging in any trade or business. (A) Joint venture. (B) Trading partnership. (C) General professional partnership. (D) Joint accounts. 3. Which of the following is a general professional partnership? (A) Partnership organized by a lawyer, engineer and a CPA to provide professional advice. (B) A partnership organized by a group of CPAs for the common practice of accountancy. (C) A partnership organized by a group of CPAs for the purpose of selling real properties. (D) General partnership organized by group of engineers engaged in manufacturing of equipment. 4. Which of the following statements is most correct? Statement 1. For purposes of computing the distributive share of the partners, the net income of the partnership shall be computed in the same manner as a corporation. Statement 2. Each partner shall report as gross income his distributive share, actually or constructively received, in the net income of the partnership. (A) Statement 1 only. (B) Statement 2 only. (C) Both statements are correct. (D) None of the above. 5. Which of the following statement is most correct? (A) The tax imposed on corporations is not imposed only upon such corporations as are organized and operated for profit. (B) A corporation, firm or association, no matter how created or organized, or what the purpose of its organization may be, is subject to tax, except as provided in Sec. 30, relative to the exemptions