QUESTION 1

The accounts of Silver and Gold Mining Company Limited for the year ended 30^th September, 2003 show the following details:

GH GH

Gross Profit B/F Rent Receivable Dividends Less Expenses: Directors Fees Salaries and Wages Repairs and maintenance Subscriptions and donations Utilities Audit Fees Legal Expenses Registration and Licensing Rent Depreciation Traveling and Transport Net Profit

16,000 640,000 260,800 48,500 1,420 500 1,100 400 6,300 124,000 39,320 2,339,728 3,478,068

3,354,068 80,000 44,000 3,478,068 ________ 3,478,068

Notes to the Accounts

1. Repairs and Maintenance: This includes,

1. Repairs on a secondhand excavator purchased for use in the business (GH3,200).
2. General repairs of all plant and machinery (GH130,000).
3. Loss on sale of obsolete plant and machinery (GH27,600).

2. Subscriptions and Donations:
   1. Scholarship awards to needy but brilliant children from the area of operations (GH10,000).
   2. KVIP facility for townsfolk (GH15,000).
   3. Donation towards the celebration of Sasako festival of the people of the area (GH2,000).
   4. Christmas gifts to the chief and his elders (GH1,500).
3. Legal Expenses

This was in defense of a charge of assault levelled against a security officer of the company.

4. Travelling and Transport
   1. Overseas travelling expenses for Kofi Adjetey, the Chief Accountant and his family while attending a seminar on mining operations in South Africa (GH13,800).
   2. Passage expenses for John Dean, an expatriate, on termination of his employment. (GH5,520)
5. Capital allowance for the year amounted to GH278,928 and unutilized capital allowance brought forward also amounted to GH40,000.
6. Loss brought forward was GH210,000.

Required:

Determine the year of assessment and compute the chargeable income. (20 marks)