Note:

1. Cekap Sdn Bhd a Malaysian resident company operating in Shah Alam, manufactures two products, a promoted product and a non-promoted product. The company had applied for investment tax allowance for the promoted product and an approval was granted by the relevant authority for five years effective from the year of assessment 2016. The projected statutory income for five years ending 31 December is as follows: Qualifying capital Year of assessment Promoted product Non-promoted product expenditure for promoted product Statutory income Statutory income (Adjusted loss) (Adjusted loss) 2016 (180,000) 12,000 100,000 2017 150,000 24,000 80,000 2018 200,000 (35,000) 70,000 2019 240,000 26,000 2020 270,000 33,000 320,000 You are required to compute the chargeable income and exempt income (if any) available to Cekap Sdn Bhd for the year assessment 2016 to 2020. Pioneer status (PS) and investment tax allowance (ITA) Companies in the manufacturing, agricultural, hotel and tourism sectors, or any other industrial or commercial sector, that participate in a promoted activity or produce a promoted product may be eligible for either PS or ITA. PS is given by way of exemption from CIT on 70% of the statutory income for five years and the remaining 30% is taxed at the prevailing CIT rate. ITA is granted on 60% qualifying capital expenditure incurred for a period of five years which is utilised against 70% of the statutory income, while the 30% balance is taxed at the prevailing CIT rate. A company that intends to undertake reinvestment before expiration of its PS or ITA status may opt for reinvestment allowance, provided it surrenders its PS or ITA status. The PS and ITA incentives are enhanced for the following types of projects: Pioneer status Investment tax allowance Qualifying industry Incentive TRP (1) Incentive TRP (1) Projects of national and strategic importance involving heavy capital investment and high technology 100% of SI (2) 5+5 100% QCE (3) against 100% SI 5 High-technology companies engaged in areas of new and emerging technologies. 100% of SI 5 60% QCE against 100% SI 5 Companies manufacturing specialised machinery and equipment. 100% of SI 10 100% QCE gainst 100% SI 5 Existing locally owned companies reinvesting in production of heavy machinery, specialised machinery, and equipment. 70% of increased SI 5 60% new QCE against 70% SI 5 Companies providing technical and vocational training, and private higher education institutions providing qualifying science courses. 100% QCE against 70% SI 10 New companies investing and existing companies reinvesting in utilising oil palm biomass to produce value-added products. 100% of SI 10 100% QCE against 100% SI 5 Small scale companies defined) that meet with specified conditions 100% of SI 5 60% QCE against 100% SI 5 Notes 1. Tax relief period (in terms of years). 2. Statutory income. 3. Qualifying capital expenditure. 0