PLEASE REFER TO THE FINANCIAL STATEMENT:

I want to know why are we using Total Assets as the base?, why not others? and where are they used in?

CORRECT ME IF I'M WRONG: Profit before tax is not used cause the balance is a loss and also it's not used when PBT is fluctuating.

Total revenue 72,298,980 137,450,000 127,762,466 120,989,378 Total expenses 72,441,106 115,010,000 106,401,058 100,675,079 Profit before income tax -142,126 22,440,000 21,361,407 20,314,299 Profit after income tax -142,126 16,830,000 15,807,442 15,235,724 Total assets 35,055,860 32,762,031 30,655,056 Total liabilities 20,435,251 15,515,651 13,567,880 Equity 14,620,609 17,246,380 17,087,1762. Planning Materiality The audit firm dictates that one planning materiality amount is to be used for the financial statement as a whole. The planning materiality bases are as follows: Base Threshold (%) Profit before tax 5-10 Turnover 0.5-1 Gross profit 2.0-5 Total assets 0.5-1 Based on the information given and your risk assessment, select the base for planning materiality that you believe is most appropriate, and provide three reasons justifying the base you have chosen, calculate the planning materiality. (You can refer to Cloud 9 case and textbook pages 123-125 and other resources for further understanding.)