Bluehound Coach Lines $($Pty$)$ Ltd $($Bluehound$)$ is a South African travel agency and transport service company. Bluehound operates luxury Bluehound coaches and semi$-$luxury, and therefore affordable, coaches in Townliner. The company transports passengers between major cities and towns on a daily basis. Bluehound transports on average $800000$ passengers per annum, while Townliner transports on average $500000$ passengers per annum across the country and bordering countries. However, this record history changed drastically and unexpectedly when Covid$-19$ hit the shores of South Africa in March $2020,$ the start of the of the company's financial year.The company year$-$end is the last day of February.Below is an extract of the Bluehound financial information:Notes$20212020$RRDr $/($Cr$)$Dr $/($Cr$)$Property Plant and Equipment$131,948,77844,097,207$Insure Prepaid$234,56045,800$Deferred revenue $/$ Contract liability$13,58082,500$Provisions$42,583,0003,095,000$Water and rates payables$18,75011,560$Profit before tax $/($Loss before tax$)$ Calculated correctly$57,540,50032,580,0001.$ Property, plant and equipmentProperty, plant and equipment comprises of land, facilities $($buildings and workshop warehouses$),$ buses and workshop equipment used for the repairs and maintenance of buses.Apart from land, which is measured using the revaluation model, all property, plant and equipment is measured using the cost model. Below is a summary of depreciation, and taxation write off periods for the respective items of property, plant andWhere relevant, you may assume that residual values are zero.The following is a breakdown of carrying amounts of property, plant and equipment shown in the extract above:equipment.Depreciation MethodTotal Estimated Useful lifeTax write$-$off periodAssetLandN$/$A Non depreciableIndefiniteN$/$A Not tax deductibleStraight$-$line$30$ years$5\%$ per annum non$-$apportioned for timeFacilitiesStraight$-$line$8$ years$4$ years apportioned for timeBusesWorkshop equipmentDiminishing balance$12\mathrm{.}5\%$ per annum$5$ years apportioned for time$20212020$Land$1\mathrm{.}12,100,0002,300,000$Facilities$1\mathrm{.}213,300,00014,000,000$Buses$1\mathrm{.}316,200,00027,000,000$Workshop equipment$1\mathrm{.}4348,778797,20731,948,77844,097,207*1\mathrm{.}1.$ Land $-$ On $28$ February $2021,$ the land was revalued down from R$2\mathrm{.}3$ million to R$2\mathrm{.}1$ million. The original cost for land was R$1\mathrm{.}8$ million.$*1\mathrm{.}2.$ Facilities $-$ Included in the facilities owned by Bluehound is an administration building purchased for R$4500000$ for which no tax allowances are granted. You may assume that all facilities were purchased on $1$ March $2010$ and that no facilities have been sold or impaired since then.$*1\mathrm{.}3.$ Buses $-$ Bluehound owns $8$ Bluehound luxury coaches and $8$ Townliner semi$-$luxury coaches. You may assume that all buses were purchased on $1$ March $2017$ at R$3\mathrm{.}2$ million per Bluehound luxury coach and R$2\mathrm{.}2$ million per Townliner semi$-$luxury coach.In November $2020,$ management decided to discontinue certain routes in light of poor performance associated with Covid$-19$ and lockdown regulations. Following on this decision, on $28$ February $2021,$ Bluehound sold four of its coaches $($two luxury Bluehound and two semi$-$luxury Townliner coaches$)$ on a lucrative deal in an auction at a total profit of R$6\mathrm{.}1$ million$\mathrm{.}1\mathrm{.}4.$ Workshop equipment $-$ The effect of discontinued routes stated above led to the closure and therefore disposal of workshop equipment in the affected areas. The workshop equipment sold on $28$ February $2021$ was purchased for R$680000.$ The disposed workshop equipment accounted for half of workshop equipment that Bluehound owned. Bluehound received a consideration of R$220000$ for the workshop equipment sold. You may assume that all workshop equipment was purchased on $1$ March $2016\mathrm{.}2.$ Insurance prepaidAll insurance costs are incurred in the production of income and are deductible for tax purposes when paid$\mathrm{.}3.$ Deferred revenue or contract liabilityThis account relates to bus tickets paid for future travel that is still outstanding at reporting date$\mathrm{.}4.$ ProvisionsA summary of the provisions' ledger accounts shows the following:$20212020$Provision for claims, accommodation and shuttling$4\mathrm{.}1(1,740,000)(2,970,000)$Provision for penalties and fines$4\mathrm{.}2(43,000)(125,000)$Provision for retrenchments$4\mathrm{.}3(800,000)(2583000)(3095000)*4\mathrm{.}1.$At each year end, Bluehound raises a provision for litigation for claims brought against the company by the commuters and drivers who embark on strikes. In addition, a provision for accommodation and shuttling for driversfor tax purposes when paid.when out$-$of$-$town is raised. All these provisions are considered to be in the production of income and are deductible$*4\mathrm{.}2.$A provision for penalties and fines is also raised annually and this is not deductible for tax purposes on the same basis that penalties and fines would not be deductible in terms of section $23($o$)$ of the Income Tax Act.$*4\mathrm{.}3.$As a result of discontinuing certain routes and selling some assets, on reporting date a provision for retrenchment of staff who will be laid off was raised. This is allowable as a tax deduction when paid$\mathrm{.}5.$ Profit $($loss$)$ before taxBluehound, like many other businesses, has been hit hard by the severe effects of Covid$-19,$ which included the lockdown regulations that suspended and at times regulated strictly, domestic traveling. Consequently, Bluehound reported material losses during the current period.Despie the unfa durable business condity duro the lation pois; Blurthouse conorate scalie an hose harprovided food parcels to the needy. A total of R$200000$ was made in donations. R$160000$ worth of donations were made to organisations from which a valid section $18$A certificate was obtained.Bluehound received R$56000$ in dividend income from its local investments with companies that profited during Covid$-19$ and lockdown, and those companies whose year$-$end was early into Covid$-19$ and, therefore, still paid dividends to their shareholders.The effects of profit or loss from the above$-$mentioned transactions have been accounted for correctly in determining the profit $($loss$)$ for the year$\mathrm{.}6.$ Future profitabilityManagement of Bluehound does not expect the company to have an immediate recovery and, therefore, return to profitability in the immediate future. This is despite efforts made to reconfigure the business model of the entity and explore other cost$-$effective and revenue generating strategies.Required$*3\mathrm{.}2.$ Using the balance sheet approach, calculate the deferred tax balance as at $28$ February $2021.*3\mathrm{.}3.$ Explain two ways in which non$-$controlling interest can be measured.