Bauhinia Limited (BL) carries on business in Hong Kong. Its statement of profit or loss for the year ended 31 December 2020 is shown as below: Notes Income Sales revenue Income from sub-letting part of office area Interest income Finance income (1) (2) (3) 3,820,000 286,000 18,000 234,000 4,358,000 (5) (6) Less: Expenses Salaries and wages Rent and rates Donations Interest expenses Audit and tax filing fees Depreciation Loss on disposal of a fixed asset Miscellaneous expenses (all deductible) (8) 836,000 422,000 53,000 7,000 65,000 103,000 11,000 39,000 (9) (1,536,000) Net profit 2,822,000 Notes: 1) BL sells goods to customers in Hong Kong and mainland China. About 30% of goods were delivered to mainland China. 2) BL sub-lets part of its office to Johnny Limited for rental at $286,000 per annum. 3) Interest income comprises: S Interest on HK$ loan to its sales manager for financing his HK accommodation 12,000 Interest on HK$ deposits with a bank in Hong Kong 4,000 Interset on RMB deposits (HK$200,000) with a bank in Hong Kong used as security for a loan (as referred to in note (8) below) 2,000 Total 18,000 4) Finance income comprises: Gain (loss) from trading in Hong Kong listed shares Gain/(loss) from trading in People's Republic of China (PRC) listed shares Dividends from Hong Kong listed shares Dividends fromChina listed shares Gain/(loss) from trading in foreign currencies Total $ 323,000 (144,000) 32,000 15,000 8,000 234,000 5) Salaries and wages comprise: $ Salaries and bonuses paid to staff 630,000 Mandatory provident fund (MPF) contributions for staff: 5% basic salary 26,000 Wages paid to a driver for BL's director 180,000 836,000 Note: BL made a special contribution to MPF in the year ended 31 December 2019 in the amount of $200,000. 6) The rent and rates were paid in respect of: $ BL's office 242,000 The diector's residence 180,000 422,000 7) The donations included cash of $30,000 to the Community Chest of Hong Kong and $23,000 medical supplies to Tung Wah Hospital. 8) Interest expenses comprise: S Interest on a bank overdraft and credit line 4,000 Interest on a bank loan of HK$150,000 for operational use; secured by the RMB deposit (as referred to in note (3) above) 3,000 7,000 9) The total accounting depreciation charge for the year of $103,000, was calculated based on the book value of BL's fixed assets as at 31 December 2020. During the year, BL incurred $450,000 to acquire an electric vehicle and $23,000 on curtain replacement. The old curtain was scrapped with zero value, giving rise to the loss on the disposal of a fixed asset of $11,000. 10) The tax depreciation schedules in BL's 2019/20 tax return showed the tax written down value carried forward to 2020/21 for its 20% plant and machinery pool to be $130,000. Required Prepare Bauhinia Limited's profits tax computation for the year ended 31 December 2020, showing the net assessable profit/adjusted loss and profits tax payable, if any. Clearly identify both the year of assessment and the basis period and show all workings, including the depreciation allowance calculation. Notes: (1) You should ignore overseas tax. (2) Detailed explanations for items not included in the profit tax computation are required. Bauhinia Limited (BL) carries on business in Hong Kong. Its statement of profit or loss for the year ended 31 December 2020 is shown as below: Notes Income Sales revenue Income from sub-letting part of office area Interest income Finance income (1) (2) (3) 3,820,000 286,000 18,000 234,000 4,358,000 (5) (6) Less: Expenses Salaries and wages Rent and rates Donations Interest expenses Audit and tax filing fees Depreciation Loss on disposal of a fixed asset Miscellaneous expenses (all deductible) (8) 836,000 422,000 53,000 7,000 65,000 103,000 11,000 39,000 (9) (1,536,000) Net profit 2,822,000 Notes: 1) BL sells goods to customers in Hong Kong and mainland China. About 30% of goods were delivered to mainland China. 2) BL sub-lets part of its office to Johnny Limited for rental at $286,000 per annum. 3) Interest income comprises: S Interest on HK$ loan to its sales manager for financing his HK accommodation 12,000 Interest on HK$ deposits with a bank in Hong Kong 4,000 Interset on RMB deposits (HK$200,000) with a bank in Hong Kong used as security for a loan (as referred to in note (8) below) 2,000 Total 18,000 4) Finance income comprises: Gain (loss) from trading in Hong Kong listed shares Gain/(loss) from trading in People's Republic of China (PRC) listed shares Dividends from Hong Kong listed shares Dividends fromChina listed shares Gain/(loss) from trading in foreign currencies Total $ 323,000 (144,000) 32,000 15,000 8,000 234,000 5) Salaries and wages comprise: $ Salaries and bonuses paid to staff 630,000 Mandatory provident fund (MPF) contributions for staff: 5% basic salary 26,000 Wages paid to a driver for BL's director 180,000 836,000 Note: BL made a special contribution to MPF in the year ended 31 December 2019 in the amount of $200,000. 6) The rent and rates were paid in respect of: $ BL's office 242,000 The diector's residence 180,000 422,000 7) The donations included cash of $30,000 to the Community Chest of Hong Kong and $23,000 medical supplies to Tung Wah Hospital. 8) Interest expenses comprise: S Interest on a bank overdraft and credit line 4,000 Interest on a bank loan of HK$150,000 for operational use; secured by the RMB deposit (as referred to in note (3) above) 3,000 7,000 9) The total accounting depreciation charge for the year of $103,000, was calculated based on the book value of BL's fixed assets as at 31 December 2020. During the year, BL incurred $450,000 to acquire an electric vehicle and $23,000 on curtain replacement. The old curtain was scrapped with zero value, giving rise to the loss on the disposal of a fixed asset of $11,000. 10) The tax depreciation schedules in BL's 2019/20 tax return showed the tax written down value carried forward to 2020/21 for its 20% plant and machinery pool to be $130,000. Required Prepare Bauhinia Limited's profits tax computation for the year ended 31 December 2020, showing the net assessable profit/adjusted loss and profits tax payable, if any. Clearly identify both the year of assessment and the basis period and show all workings, including the depreciation allowance calculation. Notes: (1) You should ignore overseas tax. (2) Detailed explanations for items not included in the profit tax computation are required