During one of Ms Lim overseas trips in 2020, Ms Lim bought 500 pieces of pearl necklaces and brought them back to Singapore. She actively sought for potential buyers through social media and sold 400 pieces to buyers both in Singapore and overseas. She made a profit of $10,000. However, due to the economic downturn, she had difficulties selling the remaining 100 pieces. She decided to sell them below cost and incurred a loss of $1,000. All the sales were made within three months from her purchase.

Quetion 1

Using the badges of trade, advise Ms Lim on the taxability and amount of profit (if applicable) made from the sale of the necklaces. In your answer, please explain the applicability of each badge of trade to Ms Lim.