Question
Noble Manufacturers Ltd., a large-scale manufacturing company has provided you with the following information for the year ended 31 December 2021. Kshs 000 Kshs 000
Noble Manufacturers Ltd., a large-scale manufacturing company has provided you with the following information for the year ended 31 December 2021.
Kshs "000" Kshs "000"
Gross Profit 48,000
Less:
General expenses 3,900
Directors fees 7,200
Depreciation 10,400
Salaries and wages 4,600
Donation to Mayors campaign kitty 820
Interest expense 6,200
Dividends paid 4,605
Repairs and maintenance 6,250
43,975
Net Profit 4,025
Additional Information
1. On I January 2021, Noble Manufacturers Ltd. Purchased his factory from Kikope Ltd., a registered contractor for Kshs 500 Million. Kikope Ltd., availed the following information details concerning the cost of construction of the factory:
Kshs "000"
Acquisition of land 25,000
Demolition of old building on site 19,000
Labour quarters built on site 60,000
Factory building 190,000
Stone perimeter wall around the factory 30,000
Bank interest paid during the period of construction 56,000
380,000
2. The factory housed a warehouse costing Kshs 17,000,000,
administration block costing Kshs 50,000,000
and showroom costing Kshs 25,000,000.
Noble Manufacturers Ltd., installed machinery costing Kshs 200,000,000 on 2 January 2021 and started manufacturing animal feed.
3. The following additional assets were acquired during the year ended 31 December 2021: Date Asset Cost Kshs. "000"
5 January Scanners 620
12 February Furniture and fixtures 820
15 March Computers 2,250
14 April Motorcycle 190
14 June Special maintenance tools 36
18 July Led screen 48
21 July 3 Salon cars (Kshs 1,600,000 each) 4,800
26 October 2 Lorries (4 tones Kshs 4m each) 8,000
4. The following assets were disposed of during the year:
Date Asset Cash Proceeds (Kshs "000")
1 October 2021 Salon car purchased by Kikope at Kshs 1,600,000) 900
6 November 2021 Furniture 295 T
he written down values brought forward for capital allowance purposes as at 1 January 2021 were as follows:
Machinery Kshs '000" 8,310
ComputersKshs '000" 6,415
Motor Vehicles Kshs '000" 6,680
Fixtures and FittingsKshs '000" 4,990
Required:
Compute for Noble Manufacturers Ltd. For the year ended 31 December 2021
: 1. The capital allowances
2. Taxable profit
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