QUESTION $315$ MARKS

Green Ltd is a resident of the Republic of Namibia. All its equity shares were listed on the

Namibian Stock Exchange on the last day of its $2023$ financial year. Its directors are David

Mukoya, Kavera Ndumba and Trust Shilongo. Throughout its $2023$ financial year, its equity

shares were held as follows:

Martha Mukoya $($Director David Mukoya$$s wife$)6\%$

Director Kavera Ndumba $5\%$

James Shindimba $20\%$

FACULTY OF COMMERCE, MANAGEMENT AND LAW

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Titus Likoro $($Director Trust Shilongo$$s uncle$)5\%$

Other individuals $($residents of China$),$ all of whom have only a

nominal shareholding $20\%$

Gems Ltd $($Diamond mining company$)15\%$

Dream $($Pty$)$ Ltd $25\%$

Dream $($Pty$)$ Ltd$\text{'}$s equity shares are held as follows:

Rian Beukes $($Director$)5\%$

Marry Black $($Director$)5\%$

Ann Mungunda $($sister of Marry Black$)10\%$

Albert Kati $16\%$

Jenny Pohamba $64\%$

$100\%$

Recognised pension fund $4\%$

$100\%$

All the relatives of directors of the referred companies have not exercised their rights

independently of the directors.

You are required to:

Determine whether Green Ltd is classified as a public or private company.

$(15$ marks$)$

QUESTION $415$ MARKS

Sauce and Pan are partners in the partnership, Saucepan Coffee Express $($Saucepan$)$ in

Windhoek Namibia. They share profits at $60\%$ and $40\%$ respectively. An extract of Saucepan$$s

Income Statement for the year ended $28$ February $2023$ is as follows:

NOTES N$ N$

Net income from trading $11616500$

Interest on drawings $1013800$

Net rentals $8149900$

Total carried forward $1780200$

Less:

Partners' salaries:

Sauce $164000$

Pan $140000$

Interest on capital accounts:

Sauce $137200$

Pan $144400$

Annuities $2118000$

Subscriptions $51850$

Insurance premium $4161800$

Travelling expenses $6127000$

Depreciation $71780$

Legal expenses $913200$

Donation $312400(1021630)$

Profit for the year $758570$

Notes

FACULTY OF COMMERCE, MANAGEMENT AND LAW

OLD CURRICULUM MODULES

Saucepan$$s net income from trading included N$$16500$ relating to bad debts recovered this year

and had been previously deducted.

$1.$ The following annuities were paid:

Ms Ndapala, a retired chef

N$$76000$

Mrs Shilongo. Mrs Shilongo$$s husband, Mr Shilongo had died in a

car accident on his way to work

N$$42000$

N$$118000$

$2.$ During the $2023$ year of assessment, the partnership made a donation of N$$12400$ to IUM

and they received a certificate.

$3.$ The insurance premiums paid during the year were in respect of the following policies:

Partner$$s life policy$-$ Pan

N$

Fire policy

$100000$

$61800$

$161800$

$4.$ The partnership has the following annual subscriptions:

Windhoek Golf Club

Barista Online magazine

N$$1000$

N$$850$

N$$1850$

$5.$ During the year Sauce went to Japan to buy a modern coffee making machine, while in

Japan he went to Shikoku island beach. Since this was not part of the partnership business,

the partners agreed that the travelling costs be apportioned at $70\%$ for business and the

remainder for Sauce$$s personal expenses.

$6.$ The partnership writes depreciation off on the coffee maker at $10\%$ on a straight line basis.

The coffee$-$maker that had been purchased for N$$17800$ and brought into use on $1$ March

$2022.$

$7.$ The rental income received by the partnership were in respect of:

Lease premium for the leasehold property

N$

Annual Rental

$30600$

$119300$

$149900$

The lease agreement between Saucepan and the lessee also included a clause for the lessee

to effect lease improvements of an additional office block to the value of N$$126300.$ The

lessee completed the office block at the agreed cost on $30$ April $2022$ and it came into use

on $1$ May $2022.$

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$8.$ Both Sauce & Pan and the lessee had agreed to share equally the costs of drafting the

lease agreement, and this was done by professional attorneys. A total of N$$13200$ was

invoiced by the attorneys and the lessee paid his share.

$9.$ Of the interest on drawings, N$$8280$ was pertaining to Sauce and N$$5520$ to Pan.

You are required:

Calculate Sauce$$s normal tax liability for the $2023$ year of assessment.

Begin your answer with the profit for the year.

$(15$ marks$)$