Better Bean On 1 December 2010, Better Bean (37-year-old resident) inherited R1 498 500 from his uncle. He used this money to buy all the shares in Lagos (Pty) Ltd (Lagos). Lagos only property is a house on 11 Riffle Range Road, in Towerby, Johannesburg South. Better Beans and his family have been using this property as a holiday home since. The company was formed in June 2002 and bought the house in August 2002. The company paid R1 220 000 cash for the property, and it does not have any other assets or liabilities. Better Beans recently moved to Cape Town for work purposes. He wants to sell the house in Towerby and use the money to buy another holiday home closer to Cape Town. On 1 December 2016 he received the following two offers to buy the house: Offer 1: Betty Mathews will buy all the shares in the company for R5 600 000. Offer 2: Jolly Modise wants to buy the house from the company for R5 600 000. Better Beans will not buy or sell any other assets during the current year of assessment and he pays tax at the maximum marginal tax rate of 41%.

2.2 You are required to determine which of the two offers will provide Better Beans with the most after-tax cash to buy the new house. Clearly indicate all calculations and considerations.