LBW (Pty) Limited owns the LBW cricket team. LBW (Pty) Limited recently sold two of its players, namely, Shaun Blue and Henry Walker, to Bowlem (Pty) Limited.  Shaun Blue was sold for R2,000,000, and  Henry Walker for R20 000. Shaun Blue started playing for the LBW cricket team five years ago in its under-19 team and, after signing a life-service contract, had been coached by LBW (Pty) Limited until he became the best fast bowler in the country. Henry Walker had been snapped up at a bargain price from Strikers Cricket Club for R12 000. When ‘purchasing’ Henry Walker, the board of directors of LBW (Pty) Limited realized he was unlikely to play in its first team, but anticipated being able to ‘sell’ him for a quick profit. This is succeeded in doing, only eight weeks after purchasing him. 

Required 

Discuss what amount, if any, LBW (Pty) Limited should include in its gross income.

Assume that the receipts and accruals of LBW (Pty) Limited are not exempt from normal tax. Ignore a possible inclusion of an amount in its taxable income under section 26A (being the inclusion of a taxable capital gain in its taxable income).