Below are extracts of the Accounts of Safeway Insurance Co. Ltd. The year ended 31/12/2005.

Short Term
GH¢
Gross premium received 2,500,000
Claims settled during the year 300,000
Re-insurance premium paid 200,000
Salaries and Wages 600,000
General administrative expenses 100,000
Commission to agents 500
Recoveries under Reinsurance 150,000
Premium returned to clients 1,250
Interest earned on loans 1,005,000
Capital Allowance claimable 70,000
Reserve at close of previous year 1,200,000
Note that reserve is calculated at 40% of net premium income
Life GH¢
Interest on Treasury Bills 475,000
Interest from H.F.C. Unit Trust 250,000
General administrative expenses 310,000
Salaries and Wages 450,000
Capital Allowance claimable  15,000
Redemption of policies matures 500,000

Required:
Find the tax payable by the Insurance Company. Use Tax rate of 28%

Answer rating: 100% (QA)

Particulars Amount in GH Gross premium received 2500000 Recove... View the full answer