QUESTION $235$ MARKS

Mr Mulunga, a commercial farmer in Hardap region, provided the following information for the

year of assessment ending $29$ February $2024$:

$1.$ Income from vegetable sales N$$320000.$

$2.200$ calves were born during the year of which $10$ drowned in a dam.

$3.$ He had $220$ cows at the beginning of the year.

$4.$ He had $8$ bulls at the beginning of the year of which $3$ were sold to the farmers$$ beef club

at N$ $10000$ each as they had low fertility rate. He bought $5$ new bulls at a cost of N$ $10$

$000$ each.

$5.$ Of the $200$ tollies he had at the beginning of the year, he sold $150$ at N$ $6000$ each. He

also donated $2$ to his golf club. He slaughtered one for his own consumption.

$6.$ Of the $120$ heifers he had at the beginning of the year, he slaughtered one every month for

rationing to his employees.

$7.$ On the $1$st of March $2023,$ he inherited $10$ tollies and $10$ heifers from his late mother,

which increased his head. He also purchased $20$ heifers at a price of N$ $6500$ each and

five were lost to predators during the year.

$8.$ The following expenses were incurred:

N$

Marketing fees $25000$

Bookkeeping Fees $50000$

Eradication of noxious plants $95000$

Installation of irrigation system $98200$

FACULTY OF COMMERCE, MANAGEMENT AND LAW

OLD CURRICULUM MODULES

Page $11$ of $18$

Fuel $50800$

Employees uniform $10500$

Building of a road $70000$

Seeds and pesticides $35000$

Insurance $35000$

Repairs to farm fence $90000$

New Tractor $282000$

Borehole drilling $130500$

Farm levy $30400$

Veterinary fees $80500$

Salaries & wages $138000$

$9.$ During the year a new home was built for his foreman at a cost of N$ $120000.$

$10.$ The market values for the livestock were as follows:

Head N$

Cows $3000$

Bulls $10000$

Tollies $6000$

Heifers $6500$

$11.$ He donated N$ $20000$ to a school that caters for children of farm workers.

$12.$ He received a soil erosion subsidy amounting to N$$25000$ during the year.

$13.$ He assisted local farmers to transport their produce with the tractor to AMTA for which

he charged a total fee of N$ $31000.$

$14.$ He charged a total grazing fee of N$ $60000$ to the neighbouring farmer who was affected

by forest fires.

$15.$ The balance brought forward in respect of capital expenses is N$ $35600.$

Required: Marks

a$)$ Prepare Mr Mulunga$$s livestock reconciliation statement at $29$ February

$2024.5$

b$)$ Compute the taxable income of Mr Mulunga at $29$ February $2024.$

NB: To earn full marks support your answers with calculations and reasons. $30$

Total $35$