Mun Tay Sdn Bhd operates as a manufacturer of silk textile since 2010. The share capital...

 

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Mun Tay Sdn Bhd operates as a manufacturer of silk textile since 2010. The share capital of 2 million of BSB is fully owned by Malaysians. For the year ended 31 December 2019, the company submitted the following profit and loss account. Sales Less: cost of sales Less: Remuneration Legal and professional charges Provision for bad debts Repair and maintenances Loss on sale of fixed asset Entertainment Subscriptions Donations Research and development expenses Other expenses Depreciation Net profit before taxation Notes: Note 2 3 4 5 6 7 RM 1,300,500 150,000 300,000 395,000 150,000 240,000 360,150 180,500 50,000 665,500 350,005 RM 14,000,500 (5,400,000) 8,600,500 (3,871,655) 4,728,845 1. Remuneration Four of the company's employees are disabled persons. Two is blind telephone operator and another two is former salesman who had lost both his legs in an accident but is now employed in the quality control department. Their monthly salaries are RM 2,000. 2. Legal and professional charges The followings are also included in the professional charges: Legal free for the registration of a new trademark Accounting fees for the setting up an integrated audit system in the purchasing department following the discovery of cash embezzlement employee Staff recruitment charges paid to an employment agency Cost incurred in obtaining Halal certificate 3. Repair and maintenance Included under repairs and maintenance is the following expenses: Repairs the drains around the factory area 19,850 Replacing and old chimney with an improved new chimney that complies 130,000 with the anti-pollution control regulations Construction of new childcare center for employees' children's 5. Subscriptions This comprises the following: Annual subscription to a trade association Entrances fee to a gold club Entrances fee to a trade association 6. Donations Cash donation to an approved institution 4. Entertainment The expenses were incurred in entertaining the company clients for sales purposes except for RM 20,000 which was incurred for the annual dinner for the company staff. The annual dinner attend by staff and family. Allocation for family is 50% 7. Other expenses Premium insurance paid for Malaysian insurance company for export item Renewal company motor vehicle road tax and insurances 8. Asset are recorded as below Asset Year Acquire Qualifying Expenditure 15,300 50,000 Cost RM 17,000 12,000 Initial 250,000 1,570 275,000 53,000 40,500 25,000 20,000 Allowance Rate % Annual Allowance Rate % Machine A Machine B Computer Furniture and Fittings Air conditioner Motor vehicle * Other asset acquired in 2019 Type of asset Cost Office Equipment Furniture Fitting Machine Machine Motor vehicles All All < 100,000 ≥100,000 Required: i. ii. All 2019 2018 2017 2017 2017 2017 122,000 234,000 400,000 25,000 10,000 180,000 Initial Allowance 20 20 20 20 20 In Year Assessment (YA) 2019 company decided to: 1. dispose their motor vehicle at price of RM 30,000. 2. dispose Computer at price of RM 300, 000 20 20 20 20 20 20 Annual Allowances 10 10 10 14 14 14 10 10 10 20 20 List the FIVE (5) Badges of trade under the corporate tax. (5 Marks) Compute the statutory income for the company for the year of assessment (YA) 2019. (20 Marks) Mun Tay Sdn Bhd operates as a manufacturer of silk textile since 2010. The share capital of 2 million of BSB is fully owned by Malaysians. For the year ended 31 December 2019, the company submitted the following profit and loss account. Sales Less: cost of sales Less: Remuneration Legal and professional charges Provision for bad debts Repair and maintenances Loss on sale of fixed asset Entertainment Subscriptions Donations Research and development expenses Other expenses Depreciation Net profit before taxation Notes: Note 2 3 4 5 6 7 RM 1,300,500 150,000 300,000 395,000 150,000 240,000 360,150 180,500 50,000 665,500 350,005 RM 14,000,500 (5,400,000) 8,600,500 (3,871,655) 4,728,845 1. Remuneration Four of the company's employees are disabled persons. Two is blind telephone operator and another two is former salesman who had lost both his legs in an accident but is now employed in the quality control department. Their monthly salaries are RM 2,000. 2. Legal and professional charges The followings are also included in the professional charges: Legal free for the registration of a new trademark Accounting fees for the setting up an integrated audit system in the purchasing department following the discovery of cash embezzlement employee Staff recruitment charges paid to an employment agency Cost incurred in obtaining Halal certificate 3. Repair and maintenance Included under repairs and maintenance is the following expenses: Repairs the drains around the factory area 19,850 Replacing and old chimney with an improved new chimney that complies 130,000 with the anti-pollution control regulations Construction of new childcare center for employees' children's 5. Subscriptions This comprises the following: Annual subscription to a trade association Entrances fee to a gold club Entrances fee to a trade association 6. Donations Cash donation to an approved institution 4. Entertainment The expenses were incurred in entertaining the company clients for sales purposes except for RM 20,000 which was incurred for the annual dinner for the company staff. The annual dinner attend by staff and family. Allocation for family is 50% 7. Other expenses Premium insurance paid for Malaysian insurance company for export item Renewal company motor vehicle road tax and insurances 8. Asset are recorded as below Asset Year Acquire Qualifying Expenditure 15,300 50,000 Cost RM 17,000 12,000 Initial 250,000 1,570 275,000 53,000 40,500 25,000 20,000 Allowance Rate % Annual Allowance Rate % Machine A Machine B Computer Furniture and Fittings Air conditioner Motor vehicle * Other asset acquired in 2019 Type of asset Cost Office Equipment Furniture Fitting Machine Machine Motor vehicles All All < 100,000 ≥100,000 Required: i. ii. All 2019 2018 2017 2017 2017 2017 122,000 234,000 400,000 25,000 10,000 180,000 Initial Allowance 20 20 20 20 20 In Year Assessment (YA) 2019 company decided to: 1. dispose their motor vehicle at price of RM 30,000. 2. dispose Computer at price of RM 300, 000 20 20 20 20 20 20 Annual Allowances 10 10 10 14 14 14 10 10 10 20 20 List the FIVE (5) Badges of trade under the corporate tax. (5 Marks) Compute the statutory income for the company for the year of assessment (YA) 2019. (20 Marks)

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a 1 The company is a manufacturer of silk textile 2 The company has a share capital of 2 million 3 T... View the full answer