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Answer according to South Africa Law - Financial Accounting Aladdin Limited is a dynamic company at the forefront of the health and safetyindustry, specializing in

Answer according to South Africa Law - Financial Accounting Aladdin Limited is a dynamic company at the forefront of the health and safetyindustry, specializing in the manufacture and sale of disinfecting sprays, foggers,and other sanitizing equipment. The emergence of global health crises in recentyears has highlighted the importance of effective and efficient sanitizationmethods, propelling companies like Lockdown Limited to the center stage ofpublic and private health defence strategies.The company's financial year concludes on the 28th of February, aligning itsreporting period with the end of the winter season in many regions, a critical timefor the deployment of sanitizing solutions due to the increased incidence ofcommunicable diseases.During the fiscal year ending February 28,2022, Aladdin Limited faced a uniqueset of challenges and opportunities. The year was marked by a gradual decreasein global pandemic-related restrictions, leading to varied demand fluctuations forsanitizing products across different markets. These dynamics forced AladdinLimited to reassess its manufacturing and distribution strategies to remaincompetitive and profitable.The following is an extract from the Statement of Financial Position of AladdinLimited for the year ended 28 February 2022:RandCurrent assets:Prepaid Expenses Water & ElectricityAccrued Income Interest on fixed deposit150002000Non-current liabilities:Deferred tax 3416Current liabilities:Current tax payable: Income taxIncome Received in Advance RentAccrued Expenses Telephone67690928000ADDITIONAL INFORMATION:1. On 1 April 2022 Aladdin Limited received its tax assessment for income taxfor the year ended 28 February 2022 which reflected an assessed amount of R59800. The accountant calculated and provided income tax for the 2022 tax yearas R55476. The accountant agreed with the tax assessment and made the finalpayment on the same day to settle the amount due for the 2022 tax year.2.1 Their accountant correctly calculated a Profit BEFORE tax of R638900but needs your help with the tax computation.Included in Profit before tax are the following transactions for the year ended29 February 2023:TRANSACTION NOTE RANDDividends received Exempt from tax 24372Donations paid Not tax deductible 56600Profit on sale of machinery See Additional Information 2.280000Depreciation on machinery See Additional Information 2.390000Depreciation on admin buildings No wear and tear allowanceallowed by SAR. 70000Depreciation on motor vehicles All vehicles were in use for thefull financial year.Note: A section 11(e) wearand tear allowance of R132500per annum was allowed bySARS.980002.2 A machinery was sold during the year. All disposal entries have beencorrectly recorded by the accountant. Details of the affected machine at the dateof sale are as follows:Capital profit 76000Non-capital profit 5000Capital gain 60000Taxable capital gain 48000Recoupment 80002.3 The wear and tear allowance allowed by SARS for the currentfinancial year relating the machinery amounts to R75000. This is correctlycalculated after taking into account the sale of the machine.3. The following prepaid expenses, accrued expenses, income received inadvance and accrued income appeared in the statement of financial positionof Aladdin Limited at 29 February 2023. These amounts were found to betaken correctly into account in the calculation of the profit before tax of R638900.(As shown in 2.1)RANDPrepaid Expenses Water & Electricity R 13000Accrued Expenses Telephone R 19000Income Received in Advance Rent R 14272Accrued Income Interest on fixed deposit R 30004. Dividends paid by the company amounted to R 300000 for the year. (Ignoredividend tax).5. Income tax and the inclusion rate for capital gains tax: The tax rate was 28% for the past two years. There are no temporary orpermanent differences other than those which are apparent from the giveninformation. The inclusion rate for capital gains purposes is 80%.6. The company uses the comprehensive
income statement approach tocalculate deferred tax.
Required:
Prepare the income tax note (only the tax rate reconciliation section) that will accompany the Statement of Comprehensive Income for the year ended 29 February 2023, in accordance with South Africa International Financial Reporting Standards. (8 marks)

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