Layout References QUESTION TWO The directors of Total engineering Company Limited presented the following Profit and Loss for the year ended 31 December 2022: CAT 2- TAXATION SEPT DEC 2023 (2) [Compatibility Mode] - Word (Product Activation Failed) Mailings View Review Tell me what you want to do... Revenues Sales Interest on Government Securities (Gross) Expenses: Purchases Wages Carriage inwards Rent Insurance Trade expenses Repairs: Building Machinery Advertising Legal charges Audit fees Depreciation Provision for doubtful debts Debenture interest Interim dividend Proposed dividend 3. 4. 5. 6. Sh. 30,780,000 50,000 30,830,000 24,000,000 2,320,000 370,000 300,000 QUESTION THREE 190,000 100,000 300,000 56,000 254,000 80,000 70,000 3,017,000 104,000 600,000 Net Loss The following additional information is provided: 1. Purchase returns and sales returns were Sh.500, 000 and Sh.700, 000 respectively. These were left out while preparing the trial balance. 400,000 731.300 32.892.300 2,062,300 Trade expenses include an amount of Sh.60, 000 travel expenses to Korea for the Director as part of the National Chamber of Commerce Trade and Industry promotion tour. Repairs to machinery include small loose tools written off by Sh.10,000 Bad debts which are specifically bad are Sh.74,000 Capital allowances have been agreed at Sh.2,000,000. Required (a)Taxable profits for the year of income 2022 (10 marks) (2 marks) (b)Tax payable if any for 2022. Comment on the results. (The company intends to give the Director a company car in 2022. What are the tax implications? (3 marks)