90.2K

Verified Solution

Link Copied!

426 Question 1 (continued) Note 5 - Miscellaneous expenses: Office party 656 Gifts of wine to customers 1,160 Removal expenses of new employee 1,360 Compensation to customers for damage from business's product 8,000 Interest on overdue VAT The tax written down values of the business's plant and machinery as at 1 April 2020 were: Main pool 150,420 Transactions in plant, machinery and motor vehicles during the year to 31 March 2021 were as follows: (0) A delivery van which had originally been bought for 23,840 was sold for 15,000. A new van was acquired in November 2020 at a cost of 24,320. The Van had CO2 emissions of 135 g/km. (ii) A new Audi motor car was purchased by Mark with CO2 emission of 175g/km costing 41,100. There is 25% private use of the Audi motor car by Mark. (ii) Two motor cars were bought for staff. One of these was a new low-emission BMW car with CO2 emissions of 40g/km, this cost 14,000. The other was a Ford and had CO2 emissions of 105g/km and cost 18,000 (iv) Equipment was sold for 25,600. Most of this equipment was sold for less than original cost, but one item was sold for 2,060 more than original cost. New equipment was bought in March 2021 for 54,720. The business claims maximum capital allowances on plant and machinery. Requirement (a) Compute the taxable trading profit. 11 Marks (b) Calculate the tax payable by Mark in respect of the 2020/21 tax year and state when the tax is due for payment. 4 Marks Total 15 Marks 426 Question 1 (continued) Note 5 - Miscellaneous expenses: Office party 656 Gifts of wine to customers 1,160 Removal expenses of new employee 1,360 Compensation to customers for damage from business's product 8,000 Interest on overdue VAT The tax written down values of the business's plant and machinery as at 1 April 2020 were: Main pool 150,420 Transactions in plant, machinery and motor vehicles during the year to 31 March 2021 were as follows: (0) A delivery van which had originally been bought for 23,840 was sold for 15,000. A new van was acquired in November 2020 at a cost of 24,320. The Van had CO2 emissions of 135 g/km. (ii) A new Audi motor car was purchased by Mark with CO2 emission of 175g/km costing 41,100. There is 25% private use of the Audi motor car by Mark. (ii) Two motor cars were bought for staff. One of these was a new low-emission BMW car with CO2 emissions of 40g/km, this cost 14,000. The other was a Ford and had CO2 emissions of 105g/km and cost 18,000 (iv) Equipment was sold for 25,600. Most of this equipment was sold for less than original cost, but one item was sold for 2,060 more than original cost. New equipment was bought in March 2021 for 54,720. The business claims maximum capital allowances on plant and machinery. Requirement (a) Compute the taxable trading profit. 11 Marks (b) Calculate the tax payable by Mark in respect of the 2020/21 tax year and state when the tax is due for payment. 4 Marks Total 15 Marks 426 Question 1 (continued) Note 5 - Miscellaneous expenses: Office party 656 Gifts of wine to customers 1,160 Removal expenses of new employee 1,360 Compensation to customers for damage from business's product 8,000 Interest on overdue VAT The tax written down values of the business's plant and machinery as at 1 April 2020 were: Main pool 150,420 Transactions in plant, machinery and motor vehicles during the year to 31 March 2021 were as follows: (0) A delivery van which had originally been bought for 23,840 was sold for 15,000. A new van was acquired in November 2020 at a cost of 24,320. The Van had CO2 emissions of 135 g/km. (ii) A new Audi motor car was purchased by Mark with CO2 emission of 175g/km costing 41,100. There is 25% private use of the Audi motor car by Mark. (ii) Two motor cars were bought for staff. One of these was a new low-emission BMW car with CO2 emissions of 40g/km, this cost 14,000. The other was a Ford and had CO2 emissions of 105g/km and cost 18,000 (iv) Equipment was sold for 25,600. Most of this equipment was sold for less than original cost, but one item was sold for 2,060 more than original cost. New equipment was bought in March 2021 for 54,720. The business claims maximum capital allowances on plant and machinery. Requirement (a) Compute the taxable trading profit. 11 Marks (b) Calculate the tax payable by Mark in respect of the 2020/21 tax year and state when the tax is due for payment. 4 Marks Total 15 Marks 426 Question 1 (continued) Note 5 - Miscellaneous expenses: Office party 656 Gifts of wine to customers 1,160 Removal expenses of new employee 1,360 Compensation to customers for damage from business's product 8,000 Interest on overdue VAT The tax written down values of the business's plant and machinery as at 1 April 2020 were: Main pool 150,420 Transactions in plant, machinery and motor vehicles during the year to 31 March 2021 were as follows: (0) A delivery van which had originally been bought for 23,840 was sold for 15,000. A new van was acquired in November 2020 at a cost of 24,320. The Van had CO2 emissions of 135 g/km. (ii) A new Audi motor car was purchased by Mark with CO2 emission of 175g/km costing 41,100. There is 25% private use of the Audi motor car by Mark. (ii) Two motor cars were bought for staff. One of these was a new low-emission BMW car with CO2 emissions of 40g/km, this cost 14,000. The other was a Ford and had CO2 emissions of 105g/km and cost 18,000 (iv) Equipment was sold for 25,600. Most of this equipment was sold for less than original cost, but one item was sold for 2,060 more than original cost. New equipment was bought in March 2021 for 54,720. The business claims maximum capital allowances on plant and machinery. Requirement (a) Compute the taxable trading profit. 11 Marks (b) Calculate the tax payable by Mark in respect of the 2020/21 tax year and state when the tax is due for payment. 4 Marks Total 15 Marks

Answer & Explanation Solved by verified expert

See Answer