1. James owns a residential condominium in Sungai Long, Selangor which he lets out on

1 January 2022 to a university student at RM1,500 per month. James has been renting this property for a few years. During the year 2022, James incurred the following expenses in respect of the property.

No.	Expenses	RM
(i)	Repayment of condominium loan (included interest RM2,400)	20,000
(ii)	Repainting of the condominium unit	4,200
(iii)	Renovation of the bedroom	1,200
(iv)	Property management expenses	3,800
(v)	Cost of replacing an air conditioner in bed room (same model as the previous unit)	1,000
(vi)	Legal fee on rental agreement	1,000

On 31 December 2022, James did not receive the December rental of RM1,500 but he received it on 15 January 2023.

Required:

Compute Jamess adjusted income from rent for the year of assessment 2022. Items that do not require adjustment should be stated as 0. (7 marks)

2. In 2022, VS Sdn Bhd let out 2 buildings. Both buildings were ready to be occupied by tenants but first building was rented out since January 2022 and second building was rented out since February 2022. The letting of both buildings was treated as a business income under s4(a) of the Income Tax Act 1967.

VS Sdn Bhd closes its accounts to 31 December annually. Income received and the interest expense on loan for each of the building for year of assessment 2022 are as follows:

	Gross income RM	Interest expense RM
First building	120,000	50,000
Second building	80,000	30,000

Required:

Compute the statutory income of VS Sdn Bhd in relation to the buildings for the year of assessment 2022 and explain the treatment of gross rental income and interest expense.