1. Discuss the alternative interpretations of interest on borrowed capital. 2. Included in the accounts of a corporate taxpayer for year-end 31st December, 2014 are the following amounts. Income tax paid for 2014 Amount to reserves $285,000 $50,000 14 The penalty for late payment is 1.5% of the outstanding tax. The penalty begins to run as of the 1st day of the calendar month following the due date (i.e. as of 1st July and Ist October). 222 Trade, Business, Profession \& Vocation Continued Amount to provide for back pay $100,000 How are these treated in the profit adjustment statement? 1. Discuss the alternative interpretations of interest on borrowed capital. 2. Included in the accounts of a corporate taxpayer for year-end 31st December, 2014 are the following amounts. Income tax paid for 2014 Amount to reserves $285,000 $50,000 14 The penalty for late payment is 1.5% of the outstanding tax. The penalty begins to run as of the 1st day of the calendar month following the due date (i.e. as of 1st July and Ist October). 222 Trade, Business, Profession \& Vocation Continued Amount to provide for back pay $100,000 How are these treated in the profit adjustment statement