Problem 10-4: The Trading and Profit & Loss Account of Mr. Z and Associates for the year ended 31.12.16 is: Mr. Z and Associates Trading & Profit and Loss Account For the year ended on December 31, 2016 Debit Taka Credit Taka Opening Stock 200,000 Sales 2,300,000 Purchases 800,000 Closing Stock 200,000 Wages 80,000 Depreciation on Equipment 20,000 Transportation in 10,000 Gross Profit (Carried Down) 1,390,000 2,500,000 2,500,000 Salaries 280,000 Gross Profit (Brought Down) 1,390,000 Rent, Rates and Taxes 60,000 Bad Debt Recovered 30,000 Annual Membership Fee 50,000 Interest and Discount Received 25,000 Legal Expenses 26,000 Interest on Debenture 80,000 Brokerage Fees 45,000 Dividend on Share 60,000 Purchase of Copyright 200,000 Commission 28,000 Bad Debts 60,000 Income from House Property 180,000 Audit Fees 50,000 Depreciation - Office furniture 60,000 Fines and Penalties 20,000 Donation to Aga Khan Dev. Network 60,000 294 Chapter - 10: Income from Business or Profession Payment from Pension Fund Tax Paid on Last Year's Assessment Loss on sale of furniture Payment to Daughter Miscellaneous Expense Net Profit 280,000 30,000 10,000 50,000 60,000 452,000 1.793.000 1.793.000 Other information: (1) Salaries are paid without deducting tax at sources. (2) Recovered amount of bad debt was previously disallowed as bad debt expense. (3) Legal expense is incurred for filing and continuing a case against competitor for protecting the interest of the business. (4) Fines and penalties were due to the noncompliance of govt. rules and regulations. (5) Miscellaneous expense includes Taka 40,000 that was incurred for payment to tax consultant who doesn't own 12 digit TIN. (6) Tax depreciation was: Depreciation on Equipment Tk. 30,000 Depreciation on Office Furniture Tk. 50,000 Required: Compute the income from business or profession and total taxable income of Mr. Z and Associates for the year ended on December 31, 2016