Mr. Fauzi is the sole proprietor of Purple Enterprise, a business which involves in trading of home appliances. The business has been operating since 2010 and closes its account on every 31 December. Below is the income statement of the business for the year ended 31 December 2020 Purple Enterprise Income Statement For the year ended 31 December 2020 Notes RM RM Sales 700,000 Less: Cost of sales 1 Opening stocks 150,000 Purchases 230,000 380,000 - Closing stocks 105,000 Gross profit 275,000 425,000 Less Expenditure: Donation 2 4,000 Advertisement 3,400 Utilities expenses 3 21,400 Communication 10,000 Repair expenses 9,100 Depreciation 17,800 Insurance premium 2,100 Salaries 186,000 Approved EPF 6 19.500 Rental on business premises 89,000 Miscellaneous expenses 6,400 Bad debt 8 4,700 373,400 51,000 Add Other Income: Dividend 9 7,600 Net Profit 59,200 Notes to the account: 1. Cost of sales Included in the amount was the withdrawal of stock for personal use. The cost of the stock was RM800 while the market price was RM1,400. 2. Donation Donation of two-door refrigerator amounting RM1,200 to 'Bonda Orphanage House', while the remaining donation was made to an approved institution 3. Utilities expenses Included water and electricity deposit amounted to RM1,500 and payment of utilities for Mr. Fauzi's house amounting RM480. 4. Insurance premium Included life insurance for employees amounted to RM700 while RM300 for Mr. Fauzi's health insurance. 5. Salaries Included in the amount of salaries are as follows: RM Salary paid to disabled employees 9,500 Mr.Fauzi's salary 36,000 Leave Passage - Mr. Fauzi 4,500 8. Approved EPF Included in approved EPF was payment of EPF for Mr. Fauzi amounted to RM2.800. 7. Miscellaneous expenses The expenses are inclusive of RM4,300 paid for Mr Fauzi's tax payable to IRB and penalty for the late renewal of business license amounting to RM750. 8. Bad debt Bad debt consisted of specific provision amounting RM1,200 while the remaining was general provision. 9. Dividend The dividend was received from a company listed in Bursa Malaysia main board. Additional information: 1. Current year capital allowance equals to RM3.750. 2. Balancing charge amounted to RM1,800. Required: Calculate the total income for Mr. Fauzi for the year of assessment 2020. Mr. Fauzi is the sole proprietor of Purple Enterprise, a business which involves in trading of home appliances. The business has been operating since 2010 and closes its account on every 31 December. Below is the income statement of the business for the year ended 31 December 2020 Purple Enterprise Income Statement For the year ended 31 December 2020 Notes RM RM Sales 700,000 Less: Cost of sales 1 Opening stocks 150,000 Purchases 230,000 380,000 - Closing stocks 105,000 Gross profit 275,000 425,000 Less Expenditure: Donation 2 4,000 Advertisement 3,400 Utilities expenses 3 21,400 Communication 10,000 Repair expenses 9,100 Depreciation 17,800 Insurance premium 2,100 Salaries 186,000 Approved EPF 6 19.500 Rental on business premises 89,000 Miscellaneous expenses 6,400 Bad debt 8 4,700 373,400 51,000 Add Other Income: Dividend 9 7,600 Net Profit 59,200 Notes to the account: 1. Cost of sales Included in the amount was the withdrawal of stock for personal use. The cost of the stock was RM800 while the market price was RM1,400. 2. Donation Donation of two-door refrigerator amounting RM1,200 to 'Bonda Orphanage House', while the remaining donation was made to an approved institution 3. Utilities expenses Included water and electricity deposit amounted to RM1,500 and payment of utilities for Mr. Fauzi's house amounting RM480. 4. Insurance premium Included life insurance for employees amounted to RM700 while RM300 for Mr. Fauzi's health insurance. 5. Salaries Included in the amount of salaries are as follows: RM Salary paid to disabled employees 9,500 Mr.Fauzi's salary 36,000 Leave Passage - Mr. Fauzi 4,500 8. Approved EPF Included in approved EPF was payment of EPF for Mr. Fauzi amounted to RM2.800. 7. Miscellaneous expenses The expenses are inclusive of RM4,300 paid for Mr Fauzi's tax payable to IRB and penalty for the late renewal of business license amounting to RM750. 8. Bad debt Bad debt consisted of specific provision amounting RM1,200 while the remaining was general provision. 9. Dividend The dividend was received from a company listed in Bursa Malaysia main board. Additional information: 1. Current year capital allowance equals to RM3.750. 2. Balancing charge amounted to RM1,800. Required: Calculate the total income for Mr. Fauzi for the year of assessment 2020
