Required: 

Determine the zakat base and zakat payable based on the Net Current Assets method and Net Invested Fund method.

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Financed by: Paid-up: Share Capital Profit for the year Retained Earnings Long term liabilities Current Accts payable Trade creditors Accrued expense Al-Birr Company Balance Sheet as at 31st December 2021 Liabilities 100,000 245,500 30,000 600,000 155,500 75,000 830,500 25,000 375,500 1,231,000 Fixed Assets (net after depreciation) Land & Buildings Equipment Vehicles Fixtures & Fittings Current Assets Inventory Debtors Accounts Receivable Cash at Bank Cash in Hand 350,500 200,500 150,000 50,000 751,000 125,500 130,000 85,000 120,000 20,000 1.231.000 Additional Information: (i) The number of shares owned by Muslim shareholders is 330,000 units (at $1.50). (ii) During the year, the Accountant of Barakah Company disclosed to the zakat authority that the company purchased the tooling equipment amounting to $7,000 from one of their trade creditors on credit and the amount has been included as part of the total amount of trade creditors. (iii) During the year, it was also disclosed that part of the stocks has been acquired from one of the suppliers who agreed for the payment to be deferred for three years amounting to $5,000 and this has been accounted for as long-term liabilities. iv) Work-in-Progress is a fifth of the total Inventory. (v) Provision for bad debts for the year ended 2021 is expected to be 12% of the total amount of debtors and this provision has not been considered by the company. Financed by: Paid-up: Share Capital Profit for the year Retained Earnings Long term liabilities Current Accts payable Trade creditors Accrued expense Al-Birr Company Balance Sheet as at 31st December 2021 Liabilities 100,000 245,500 30,000 600,000 155,500 75,000 830,500 25,000 375,500 1,231,000 Fixed Assets (net after depreciation) Land & Buildings Equipment Vehicles Fixtures & Fittings Current Assets Inventory Debtors Accounts Receivable Cash at Bank Cash in Hand 350,500 200,500 150,000 50,000 751,000 125,500 130,000 85,000 120,000 20,000 1.231.000 Additional Information: (i) The number of shares owned by Muslim shareholders is 330,000 units (at $1.50). (ii) During the year, the Accountant of Barakah Company disclosed to the zakat authority that the company purchased the tooling equipment amounting to $7,000 from one of their trade creditors on credit and the amount has been included as part of the total amount of trade creditors. (iii) During the year, it was also disclosed that part of the stocks has been acquired from one of the suppliers who agreed for the payment to be deferred for three years amounting to $5,000 and this has been accounted for as long-term liabilities. iv) Work-in-Progress is a fifth of the total Inventory. (v) Provision for bad debts for the year ended 2021 is expected to be 12% of the total amount of debtors and this provision has not been considered by the company.

Answer rating: 100% (QA)

To determine the zakat base and zakat payable based on the Net Current Assets method and Net Investe... View the full answer