50.1K

Verified Solution

Link Copied!

Question 2 (25 Marks) The following are the results of Perfect Tech Manufacturing Company (Pty) Ltd, a company recognised as an approved manufacturing company for tax purposes, for the year ended 31 March 2013: Income Sales Fair value adjustment Rent received Interest received 8,390,263 296,224 142,896 67,382 8,896,765 3,611,805 1,960,321 874,139 Expenses Cost of sales Salaries and wages Administrative expenses Goodwill written off Impairment of investment Loss on sale of plant Depreciation 200,000 375,000 39,897 489,729 Donations Amortisation of patent Provision for future expenses Management fees 28,526 58,027 176,800 350,000 8,164,244 Net profit for the year 732,521 Plant Vehicles The following additional information is provided: 1. The tax value of the assets at 1 April 2012 is made up as follows: Furniture Cost 275,034 2,893,682 Accumulated capital allowances (87,290) (1,652,906) 1,678,338 (873,752) Tax value 1 April 2012 187,744 1,240,776 804,586 2. The loss on sale of plant is calculated: Cost Accumulated depreciation 528,113 (208,216) Fair value adjustment Sales price 319,897 120,000 (400,000) Loss on sale 39,897 Capital allowances amounting to P328, 424 had been claimed in respect of the sold plant as at 31 March 2013 3. Replacement plant was purchased for P822, 600. 4. Management fees are payable to a non-resident. Withholding tax of P26, 250 was paid during tl year. 5. The company made the following tax payments during the year: Self-assessment tax 150,000 Withholding tax on interest received Withholding tax on rent received 6,738 7,145 Required: (a) Calculate the balancing charge or allowance for Perfect Tech Manufacturing Company (Pty) Ltd for the year ended 31 March 2013 on the sale of plant, taking advantage of any reliefs that are granted. (4 marks) (b) Calculate the taxable income for Perfect Tech Manufacturing Company (Pty) Ltd for the year ended 31 March 2013 (15 marks) (c) Calculate the net tax payable by or refundable to Perfect Tech Manufacturing Company (Pty) Ltd for the year ended 31 March 2013 (3 marks) (d) Briefly define the scope of VAT in Botswana. (3 Marks) Question 2 (25 Marks) The following are the results of Perfect Tech Manufacturing Company (Pty) Ltd, a company recognised as an approved manufacturing company for tax purposes, for the year ended 31 March 2013: Income Sales Fair value adjustment Rent received Interest received 8,390,263 296,224 142,896 67,382 8,896,765 3,611,805 1,960,321 874,139 Expenses Cost of sales Salaries and wages Administrative expenses Goodwill written off Impairment of investment Loss on sale of plant Depreciation 200,000 375,000 39,897 489,729 Donations Amortisation of patent Provision for future expenses Management fees 28,526 58,027 176,800 350,000 8,164,244 Net profit for the year 732,521 Plant Vehicles The following additional information is provided: 1. The tax value of the assets at 1 April 2012 is made up as follows: Furniture Cost 275,034 2,893,682 Accumulated capital allowances (87,290) (1,652,906) 1,678,338 (873,752) Tax value 1 April 2012 187,744 1,240,776 804,586 2. The loss on sale of plant is calculated: Cost Accumulated depreciation 528,113 (208,216) Fair value adjustment Sales price 319,897 120,000 (400,000) Loss on sale 39,897 Capital allowances amounting to P328, 424 had been claimed in respect of the sold plant as at 31 March 2013 3. Replacement plant was purchased for P822, 600. 4. Management fees are payable to a non-resident. Withholding tax of P26, 250 was paid during tl year. 5. The company made the following tax payments during the year: Self-assessment tax 150,000 Withholding tax on interest received Withholding tax on rent received 6,738 7,145 Required: (a) Calculate the balancing charge or allowance for Perfect Tech Manufacturing Company (Pty) Ltd for the year ended 31 March 2013 on the sale of plant, taking advantage of any reliefs that are granted. (4 marks) (b) Calculate the taxable income for Perfect Tech Manufacturing Company (Pty) Ltd for the year ended 31 March 2013 (15 marks) (c) Calculate the net tax payable by or refundable to Perfect Tech Manufacturing Company (Pty) Ltd for the year ended 31 March 2013 (3 marks) (d) Briefly define the scope of VAT in Botswana

Answer & Explanation Solved by verified expert

See Answer