1 Capital allowances include two components, namely:

I initial allowance

II Industrial building allowance

III Investment allowance

IV annual allowance

A I, II

B I, III

C I, IV

D III and IV

2 The test for plant includes:

I Must not be part of the premises

II Must have been acquired by the taxpayer for at least one year

III Must not be stock in trade

IV Must be used to carry on the business

A I, II, IV

B I, III, IV

C II, III, IV

D All of the above

3 Which of the following do NOT qualify for capital allowance?

A plant

B Machines

C Rental

D Furniture

4 Which of the following statements is NOT true?

A Initial allowance is a flat rate give every year based on the original cost of the asset.

B The purpose of capital allowance is to give a relief for wear and tear of fixed assets for business.

C Capital allowance is only applicable to business activity and not for individuals.

D Capital allowances and charges are provided in Schedule 3 of the Income Tax Act 1967.