Answer ALL the questions below [100 MARKS] QUESTION 1 (20 Marks) News Dot Com (Pty) Ltd is the biggest daily newspaper in South Africa, with over 300 000 daily sales across all provinces and a readership of more than 6 100 000. It targets readers in and around the major urban centres. These readers are the economic core of South Africa. News Dot Com (Pty) Ltd distributes most of its newspapers on credit to the retailers. The following information is provided in respect of the News Dot Com (Pty) Ltd's year of assessment ended 31 December 2018: 1. Sales Cash sales Credit sales R 900 ODD 4 200 000 2. Interest on debtors' accounts R210 000 3. Debts written off R362 500 4. The allowance for doubtful debt reflected on the Statement of Financial Position for each of the respective years is as follows: R 31 December 2017 650 000 31 December 2018 920 000 5. On 22 December 2018, Michelle Moon, the Chief Executive Officer (CEO) of News Dot Com (Pty) Ltd donated R32 000 in cash to the Gift of Givers (a registered Public Benefit Organisation (PBO)). 6. Employee-related posts: Wages and salaries R1 200 000 Medical aid funds and pension fund contributed on behalf of the employees R150 000 As Vinolia was getting sick and tired of co-editor, William's bossy and arrogant attitude, she decided to call a shareholder meeting and had William removed from his chair by passing a special resolution on 30 July 2018 This was effective immediately. William did not take this very well and instituted legal action against the company on the basis of the Employment Equity Act in the CCMA. The company agreed to settle the issue out of court and paid William damages amounting to R350 000. This was duly paid on 31 August 2018. 7. Pretoria High Court Acting Judge ordered the newspaper and journalist Correta Moloi to compensate Alvis Plessis for tarnishing his reputation in an October 2013 article headlined "Frozen - For an Onion'. Alvis Plessis, a market agent at the Tshwane Fresh Produce Market, claimed News Dot Com (Pty) Ltd's article about a man locked in a cold storage room for stealing an onion contained lies, was defamatory,News Dot Com (Pty) Ltd was ordered during the year of assessment to pay R1 350 000 in compensation to a Pretoria market agent for defaming him in an article three years ago. 8. Legal expenses incurred: Legal cost of William case refer to note 6 above Legal cost Alvis Plessis case refer note 7 above Cast of a restraint of trade agreement in respect of an employee, Christocel Zuma who resigned on 1 June 2018 to set up her own business. The restraint is for a period of two years from the date she resigned. R 25 000 25 000 15 000 9. Advertising and publicity related costs: Advertising on local radio station Billboard costs R 37 000 50 000 Required: Determine the normal tax payable by News Dot Com (Pty) Ltd, if any, in respect of its year of assessment enced 31 December 2018. Provide brief adequate reasons for all amounts included excluded. Appendix 1: Turnover tax rates (1 March 2018 - 28 February 2019) Taxable turnover (R) Rate of tax 0 - 335 000 10% 335 001 - 500 000 1% of the amount above R335 000 500 001 - 750 000 R1650 + 2% of the amount above R500 000 750 001 and above R6 650 + 3% of the amount above R750 000