05-09 - TAXATION Answer 1 (a) Computation of Tax Liability...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
1 TAXATION Answer 1 (a) Computation of Tax Liability for Safe Way Sdn. Bhd. YA 2005 RM RM + - Sec 4(a) : Business Net profit before tax 1,394,000 Cost of sales: Stock obsolescence 39,500 Written off NIL Other income: Interest – trading NIL Interest – Hong Kong 23,000 Dividend 72,000 Compensation - machine NIL Salaries and Wages: Disabled employee (d/d) 20,000 Entertainment (50%) 6,000 Traveling allowance NIL Executive - prematurely NIL Rental of premises: Computer - disabled NIL Wheelchair - disabled NIL Insurance (d/d) 18,000 Staff Welfare: Scholarships NIL Leave passage 23,000 Lease rental: Van NIL Car (72,000 – 50,000) 22,000 Bad debts: Specific 23,000 Gen. provision 32,000 Recovered – customer 42,000 – ex-director 19,000 Repairs and maintenance: Construction 27,000 Depreciation 297,000 Child care – maintenance NIL Extention of child care center 43,000 Miscellaneous: Meals - employees NIL Lunches (50%) 14,500 Donation (12,000 + 2,000) 14,000 Marketing: Approved research (d/d) 80,000 Goodwill NIL Legal and professionals: Trade debt NIL
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
2 Lease renewal NIL Defending a suit NIL Architect’s fees 6,000 Training and consultancy: NPC (d/d) 29,000 Consultancy NIL Packaging and delivery NIL 1,983,000 261,000 (261,000 ) Adjusted Income 1,722,000 (-) Capital Allowance C. Year 219,000 B. Forward 47,500 (266,500) Statutory Income 1,455,500 (-) B. Forward loss (120,000 ) 1,335,500 (+) Sec 4C: Dividend (gross) 100,000 Interest – HK Exempt Aggregate Income 1,435,500 (-) Approved donation: Cash (subject to 5% restriction) (12,000) In kind (not qualified) NIL Chargeable Income 1,423,500 Tax on the 1 st RM 500,000 @20% =RM100,000 Tax on the balance RM 923,500 @28% =RM258,580 RM1,423,500 RM358,580 Less : Sec 110 Tax credit (28% x 100,000) (28,000 ) Tax Payable RM330,580 (22 marks) (b) Textile Sdn. Bhd. Packaging Machine YA 2000 : Qualifying Plant Expenditure RM650,000 IA 20% (130,000) CA AA 14% ( 91,000 ) = RM221,000 Residual Expenditure (RE) 429,000 CA YA 2001 : AA 14% (91,000 )} = RM91,000 RE 338,000 CA YA 2002 : AA 14% (91,000) } = RM91,000 RE 247,000 YA 2003 : 22/7/03 – Sale Proceed (Controlled transfer) (247,000 ) Balancing adjustment NIL
Background image of page 2
3 Fashion Sdn. Bhd. YA 2003 : R.E (deemed) RM247,000 IA 20% NIL CA AA 14% x 650,000 (91,000) =RM91,000 RE 156,000 CA YA 2004 : AA 14% (91,000 ) =RM91,000 RE 65,000 YA 2005 : 8/7/05 Sale Proceed (730,000 ) Balancing Charge 665,000 Taxable balancing charge is restricted to total capital allowance claimed by both companies ie RM585,000. ICON Sdn. Bhd.
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 11/10/2010 for the course UM ceaa1122 taught by Professor Sam during the Spring '10 term at Calumet College.

Page1 / 8

05-09 - TAXATION Answer 1 (a) Computation of Tax Liability...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online