Question 2

On 12 March 2014, Mr. KFC signed a sale and purchase agreement to acquire a piece of land for RM 250,000. He made full payment of the purchase price on 10 June 2014 and took possession of the land on 11 June 2014. The title of the land was transferred to him on 10 September 2014

He then set up a chicken farm on this piece of the land. His expenditure was as follows.

	RM
Stamp duty on acquisition Legal fees on acquisition Drainage and irrigation system Farm buildings Fencing Legal fees to defend his title to the land	4,000 1,980 13,500 22,800 5,600 27,000

On 8 February 2016, he disposed of the entire organic farm for RM 677,000. His expenditure on disposal was as follows.

	RM
Real estate agents fees Advertisement for sale Valuation fees	16,500 2,500 1,000

Required:

a) State the date of acquisition of the land by Mr. KFC giving reasons for your answer. (3 marks)

b)state with reasons, what the date of acquisitions of the land would have been if Mr. KFC did not sign a written agreement regarding its purchase. all other facts regarding the land remain the same as above (5 marks)