QUESTION 2 Mr. Aran operates his own seafood trading business in Stalls No. 1230 to 233 in the Georgetown City Market. The statement of profit and loss for his business for the year ended 31-December 2020 is as follows. Arun Seafood Trading Statement of Profit and Loss For the financial year ended 31 December 2020 Note RM RM Sales revenue 1,005,000 Less: Cost of sales 1 (641.770 Gross profit 363.230 Add: Other income 2 10,577 373,807 Less: Expenses Salaries and wages 3 247,634 Repair and maintenance 4 16.200 Entertainment 5 12.180 Allowance for doubtful debts (general) 12.590 Bad debts written-off 31.650 Utilities 6 7.500 Depreciation 30.750 Professional fees and charges 7 3,869 Donations 8 6,781 (369.154) Net profit before tax 4,653 The following notes have been provided in respect of the statement above: 1. Cost of sales included the following costs: Payments to seafood suppliers RM626,330 Loss due to rotten seafood unfit for sale RM 15.440 2. Other income comprised of interests received from the business' fixed deposit accounts. 3. Salaries and wages expenses are made up of: Salaries and allowances paid to employees RM141,600 Salaries paid to Mr. Ann RM 72,590 Employee's Provident Fund (EPF) contributions for employees RM 30.444 Personal protective equipment for employees RM 3,000 4. Repairs and maintenance expenses comprised of: Installation of a new CCTV system to monitor the stalls Repair of two damaged freezers used to store senfoods RM 9.810 RM 6.390 5. Entertainment expenses consisted of Deepavali and family day celebrations for employees and their RM 7.180 families in Genting Highlands Cash contribution for the wedding reception of Mr. Anun's son RM 5,000 6. The expense included the water bill of RM614 for January 2021 which Mr. Anm had accidentally provided to the accountant. 7. Professional fees and charges were made up of Fees for accounting and auditing services RM 2,760 Fines for parking offences in the market compound RM 888 Fees for preparation and submission of tax returns for the Year RM 1,109 of Assessment (YA) 2020 8. Donations consisted of: Donation of seafood to an approved soup kitchen in Georgetown. RM 3,780 The market value of the seafood on the day of donation was RM4,190 Cash donation to an approved orphanage on Mr. Arun's birthday RM 3.001 Mr. Arun's seafood trading business records also reflected the following information: Capital allowance for YA2020 RM 29.140 Unabsorbed business loss from YA2018 RM 485 Required: Calculate the total income of Mr. Ann for YA2020 Note: Start your computation with the 'net profft before taxation figure. Indicate "nil' in the appropriate column for items that do not require adjustment. You do not need to explain the adjustments made (12 marks) QUESTION 2 Mr. Aran operates his own seafood trading business in Stalls No. 1230 to 233 in the Georgetown City Market. The statement of profit and loss for his business for the year ended 31-December 2020 is as follows. Arun Seafood Trading Statement of Profit and Loss For the financial year ended 31 December 2020 Note RM RM Sales revenue 1,005,000 Less: Cost of sales 1 (641.770 Gross profit 363.230 Add: Other income 2 10,577 373,807 Less: Expenses Salaries and wages 3 247,634 Repair and maintenance 4 16.200 Entertainment 5 12.180 Allowance for doubtful debts (general) 12.590 Bad debts written-off 31.650 Utilities 6 7.500 Depreciation 30.750 Professional fees and charges 7 3,869 Donations 8 6,781 (369.154) Net profit before tax 4,653 The following notes have been provided in respect of the statement above: 1. Cost of sales included the following costs: Payments to seafood suppliers RM626,330 Loss due to rotten seafood unfit for sale RM 15.440 2. Other income comprised of interests received from the business' fixed deposit accounts. 3. Salaries and wages expenses are made up of: Salaries and allowances paid to employees RM141,600 Salaries paid to Mr. Ann RM 72,590 Employee's Provident Fund (EPF) contributions for employees RM 30.444 Personal protective equipment for employees RM 3,000 4. Repairs and maintenance expenses comprised of: Installation of a new CCTV system to monitor the stalls Repair of two damaged freezers used to store senfoods RM 9.810 RM 6.390 5. Entertainment expenses consisted of Deepavali and family day celebrations for employees and their RM 7.180 families in Genting Highlands Cash contribution for the wedding reception of Mr. Anun's son RM 5,000 6. The expense included the water bill of RM614 for January 2021 which Mr. Anm had accidentally provided to the accountant. 7. Professional fees and charges were made up of Fees for accounting and auditing services RM 2,760 Fines for parking offences in the market compound RM 888 Fees for preparation and submission of tax returns for the Year RM 1,109 of Assessment (YA) 2020 8. Donations consisted of: Donation of seafood to an approved soup kitchen in Georgetown. RM 3,780 The market value of the seafood on the day of donation was RM4,190 Cash donation to an approved orphanage on Mr. Arun's birthday RM 3.001 Mr. Arun's seafood trading business records also reflected the following information: Capital allowance for YA2020 RM 29.140 Unabsorbed business loss from YA2018 RM 485 Required: Calculate the total income of Mr. Ann for YA2020 Note: Start your computation with the 'net profft before taxation figure. Indicate "nil' in the appropriate column for items that do not require adjustment. You do not need to explain the adjustments made (12 marks)
