You are given the following transactions relating to the capital expenditure of Marang Logistics Solutions (Pty) Ltd for the year ended 31 December 2022: The tax written down value of capital items on 1 January 2022 was: Cost Capital Allowance WDV Office Buildings 800,000 50,000 750,000 Furniture and Fittings 89,000 44,000 45,000 Other plant and machinery 350,000 125,000 225,000 Commercial Vehicles 1,600,000 750,000 850,000 The following purchases were made during the year: P Commercial Vehicles 940,000 2x Toyota Corollas 450,000 Furniture & Fittings 40,000 Other P & M 150,000 Office Buildings 96,000 A commercial Vehicle that had a cost of P96,000 and on which allowances of P72,000 had been claimed was traded in for P24,000 against the cost of a new vehicle which is not included in the purchases above. A balance of P108,000 was paid for the new vehicle. A further three vehicles were disposed for P650,000. Their cost was P870,000 and the allowance granted to date were P435,000. Each vehicle was sold for more than its tax written down value. The proceeds were applied to the purchase of new trucks. Insurance proceeds of P28,000 were received in respect of Other Plant & Machinery that had been destroyed. The cost of the plant was P120,000 and the allowances were P90,000. The plant was not replaced. Furniture & Fittings costing P25,000 destroyed by fire was written off. The accumulated allowances amounted to P17,500. The net profit for the year was P792,000 after charging depreciation of P130,000 and crediting profit on sale of assets of P32,000. Required: In respect of Marang Logistics Solutions (Pty) Ltd for the year ended 31 December 2022: Calculate the balancing charges and allowances in respect of the sale of Non-Current Assets. Calculate the capital allowances and the tax written down value to be carried forward. Calculate the taxable income ensuring that all reliefs and allowances are claimed.
You are given the following transactions relating to the capital expenditure of Marang Logistics Solutions (Pty) Ltd for the year ended 31 December 2022:
- The tax written down value of capital items on 1 January 2022 was:
Cost Capital Allowance WDV
Office Buildings 800,000 50,000 750,000
Furniture and Fittings 89,000 44,000 45,000
Other plant and machinery 350,000 125,000 225,000
Commercial Vehicles 1,600,000 750,000 850,000
- The following purchases were made during the year:
P
Commercial Vehicles 940,000
2x Toyota Corollas 450,000
Furniture & Fittings 40,000
Other P & M 150,000
Office Buildings 96,000
- A commercial Vehicle that had a cost of P96,000 and on which allowances of P72,000 had been claimed was traded in for P24,000 against the cost of a new vehicle which is not included in the purchases above. A balance of P108,000 was paid for the new vehicle.
- A further three vehicles were disposed for P650,000. Their cost was P870,000 and the allowance granted to date were P435,000. Each vehicle was sold for more than its tax written down value. The proceeds were applied to the purchase of new trucks.
- Insurance proceeds of P28,000 were received in respect of Other Plant & Machinery that had been destroyed. The cost of the plant was P120,000 and the allowances were P90,000. The plant was not replaced.
- Furniture & Fittings costing P25,000 destroyed by fire was written off. The accumulated allowances amounted to P17,500.
- The net profit for the year was P792,000 after charging
depreciation of P130,000 and crediting profit on sale of assets of P32,000.
Required:
In respect of Marang Logistics Solutions (Pty) Ltd for the year ended 31 December 2022:
- Calculate the balancing charges and allowances in respect of the sale of Non-Current Assets.
- Calculate the capital allowances and the tax written down value to be carried forward.
- Calculate the taxable income ensuring that all reliefs and allowances are claimed.
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