Question
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
QUESTION 1
The accounts of Silver and Gold Mining Company Limited for the year ended 30th 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,
- Repairs on a secondhand excavator purchased for use in the business (GH3,200).
- General repairs of all plant and machinery (GH130,000).
- Loss on sale of obsolete plant and machinery (GH27,600).
- Subscriptions and Donations:
- Scholarship awards to needy but brilliant children from the area of operations (GH10,000).
- KVIP facility for townsfolk (GH15,000).
- Donation towards the celebration of Sasako festival of the people of the area (GH2,000).
- Christmas gifts to the chief and his elders (GH1,500).
- Legal Expenses
This was in defense of a charge of assault levelled against a security officer of the company.
- Travelling and Transport
- Overseas travelling expenses for Kofi Adjetey, the Chief Accountant and his family while attending a seminar on mining operations in South Africa (GH13,800).
- Passage expenses for John Dean, an expatriate, on termination of his employment. (GH5,520)
- Capital allowance for the year amounted to GH278,928 and unutilized capital allowance brought forward also amounted to GH40,000.
- Loss brought forward was GH210,000.
Required:
Determine the year of assessment and compute the chargeable income. (20 marks)
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