Alitra Trading Limited, incorporated in 1998, is a UK resident company which manufactures

a variety of sports goods for the local and overseas markets. The detailed statement of

profit or loss for the year ended on 31 March 2018 is as follows:

Gross profit 780,000

Loan interest received (Note 1) 11,300

Profit from sale of plant asset (Note 2) 28,000

Income from property (Note 3) 9,000

Bank interest received (Note 4) 1,800 50,100

830,100

Expenses:

Depreciation 45,740

Entertainment (Note 5) 9,200

Gifts (Note 6) 2,600

Professional fees (Note 7) 29,300

Repairs, renewals & maintenance (Note 8) 49,320

Salaries and wages 420,000

Director's remuneration 90,000 (646,160)

Finance cost

Interest payable (18,900)

Profit before taxation 165,040

Notes:

1 Loan interest received

The interest was received from loans to employees and is the amount accrued up to

31 March 2018. All loans were given on market lending rates.

2. A plan item was sold for 180,000 on profit of 28,000. The chargeable gain on sale

has been computed to 16,700

3. Income from property is a rental income in respect of a company owned labor

accommodation let to an unconnected party. The amount shown is the amount

accrued up to 31 March 2018. However, only half of the amount shown has been

received by 31 March 2018

4. Bank interest received is in respect of a deposit held for non-trading purposes and is

the amount accrued up to 31 March 2018.

5. Entertainment:

Entertaining suppliers 5,600

Entertaining employees 3,600

6. Gifts:

Gifts to customers (pens costing 40 each and displaying company's name) 900

Gifts to customers (food hampers costing 45 each, displaying company's name)

1700

7. Professional fees:

Accountancy fee 16,300

Legal fee in connection of loan 9,500

note issued for financing trading activities

Legal fee in connection with fine for breach of 3,500

workplace safety

8. Repairs, renewals & maintenance (Note 8)

Construction of 2 accommodation 32,400

rooms for security staff

Annual maintenance cost of cooling equipment 8,320

Repairs and maintenance of company cars used 8,600

by employees/directors

9. Capital allowances:

Written down value (WDV) brought forward of main pool is 80,400. Alitra acquired

a new machinery item at the cost of 42,300. In addition to it, company acquired

two motor cars with following details:

Motor car (1) purchased second-hand has CO2 emissions of 65g/km for 12,300

Motor car (2) purchased new has CO2 emissions of 110g/km for 16,500

Required:

Compute trading profits of Alitra Trading Limited for the year ended 31 March 2018.

Start with the profit before taxation of 165,040 and list all of the items in the

statement of profit and loss indicating by the use of a zero (0) any items that do not

require adjustment. Assume that the company claims maximum available capital

allowances.

Compute taxable total profits for the year ended 31 March 2018?

Compute Alitra Ltd's corporation tax liability for the year ended 31 March 2018.