Farah, Fizo and Rara are partners of FIRA Fashion which was formed on 1 January 2018.On 30

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Question:

Farah, Fizo and Rara are partners of FIRA Fashion which was formed on 1 January 2018.On 30 June 2021, for some personal reason, Rara left the partnership and withdrew her capital contribution. Farah and Fizo decided to admit new partner, Rina to the partnership. The information regarding the partnership business for the year ended 31 December 2021are as follow:

	Jan 2021- June2021	July 2021- Dec2021
Interest on capital per annum	8%	10%

Profit sharing ratio:
Farah	1	1
Fizo	1	1
Rara	1	-
Rina	-	2

Monthly salary:
Farah	RM5,000	RM5,500
Fizo	RM5,000	RM6,000
Rara	RM5,000	-
Rina	-	RM7,000

Partners' monthly allowance
Farah	RM400	RM500
Fizo	RM400	RM500
Rara	RM400	-
Rina	-	RM500

Additional information:

Each partner is required to maintain a fixed capital of RM250,000.However, Rina contributed RM300,000 as her capital in the partnership.
The provisional adjusted income reported by the company is amounted to RM410,000.
The partnership donated RM10,500 to an approved institution on 1 May 2021.
The following income was earned by the partners in the year 2021:

1. Farah earned RM80,000 from the royalty of her novels.

2.Rara generated an adjusted rental income for the year amounted to RM65,000.

3. Rina is an artist and earned RM100,000 from her paintings.

4. Fizo runs a small restaurant with his brother and earned RM25,000as adjusted income from the business.

5. In the year 2021, the business has the acquired a new van was for the purpose of transporting goods to its customer. The van was acquired on hire purchase at the cost of RM125,000 and 10% deposit was paid on 10 September 2021. The first instalment begins in the month of October 2021 for a total of 48 months.

6. A car used by the partnership was involved in an accident on 10 December 2021. The business was paid with a compensation of RM38,000 by the insurance company. The residual expenditure of the car was RM34,000

Required:

Determine the total income of each partner for the year of assessment2021. Shows clearly the computation of capital allowances, balancing charge or allowance claimable by the partner.