Question 5 Mr. Arnold is the chief accountant of Don Ltd(Pty). Don's Statement of profit or loss and other comprehensive income for the 2021 year of assessment ended on the last day of February is as follows:

Income N$ Sales 800 000 Recovered bad debts(note a) 15 000 Doubtful debts allowance-2020(note b) 11 000 Local dividend 24 000 Interest received on current account 8000 EXPENSES Purchase (450 000) Sundry expenses- deductible for tax purposes (80 000) Rent paid(note b) (32 000) Leasehold improvements(note b) (150 000) Employer contributions (note c) (20 000) Doubtful debts allowance-2020(note d) (2000) Patent(note e) (30 000) Restraint of trade payments(note g) (10 000) Legal Fees (note h) (9000) Annuities(note i) (30 000) Net profit 45 000

mprovements were completed at a cost of N$150 000 and May 2020. a) Don Ltd (Pty) contributes towards a pension fund on behal Commissioner regards Don's approved remuneration as NS d) Included in Don's outstanding accounts receivable are dou The previous year's amount of doubtful debts was N$25 00 10% of the doubtful debts as an allowance. e) Don Ltd (Pty) purchased two patents. Patent A was acquire 30th September 2010, and its probable duration of use was Patent 8 was purchased at a cost of N$30 000 on 31st Ma of 10 years. 0 On 1st July 2020 Don Ltd (Pty) paid an amount of N$80 000 of its former employees, as a restraint of trade paymente full amount will be included in the recipient's gross income. g) Legal fees were incurred in drawing up the lease agreemer h) Lucas, an employee was injured whilst at work and could duties. He received an annuity of N$4 000 per month from 1 on 31st December 2020 because of the accident and an month was paid to his widow from the following month. Required: Calculate the taxable income of Don Ltd (Pty) for the year o February 2021 Supply brief reasons for each item to support your answer an reasons where there are no tax implications or adjustments. Begin your answer with net profit per the accounting statement comprehensive income. Ignore VAT throughout. Logical layout and presentation (1). mprovements were completed at a cost of N$150 000 and May 2020. a) Don Ltd (Pty) contributes towards a pension fund on behal Commissioner regards Don's approved remuneration as NS d) Included in Don's outstanding accounts receivable are dou The previous year's amount of doubtful debts was N$25 00 10% of the doubtful debts as an allowance. e) Don Ltd (Pty) purchased two patents. Patent A was acquire 30th September 2010, and its probable duration of use was Patent 8 was purchased at a cost of N$30 000 on 31st Ma of 10 years. 0 On 1st July 2020 Don Ltd (Pty) paid an amount of N$80 000 of its former employees, as a restraint of trade paymente full amount will be included in the recipient's gross income. g) Legal fees were incurred in drawing up the lease agreemer h) Lucas, an employee was injured whilst at work and could duties. He received an annuity of N$4 000 per month from 1 on 31st December 2020 because of the accident and an month was paid to his widow from the following month. Required: Calculate the taxable income of Don Ltd (Pty) for the year o February 2021 Supply brief reasons for each item to support your answer an reasons where there are no tax implications or adjustments. Begin your answer with net profit per the accounting statement comprehensive income. Ignore VAT throughout. Logical layout and presentation (1). mprovements were completed at a cost of N$150 000 and May 2020. a) Don Ltd (Pty) contributes towards a pension fund on behal Commissioner regards Don's approved remuneration as NS d) Included in Don's outstanding accounts receivable are dou The previous year's amount of doubtful debts was N$25 00 10% of the doubtful debts as an allowance. e) Don Ltd (Pty) purchased two patents. Patent A was acquire 30th September 2010, and its probable duration of use was Patent 8 was purchased at a cost of N$30 000 on 31st Ma of 10 years. 0 On 1st July 2020 Don Ltd (Pty) paid an amount of N$80 000 of its former employees, as a restraint of trade paymente full amount will be included in the recipient's gross income. g) Legal fees were incurred in drawing up the lease agreemer h) Lucas, an employee was injured whilst at work and could duties. He received an annuity of N$4 000 per month from 1 on 31st December 2020 because of the accident and an month was paid to his widow from the following month. Required: Calculate the taxable income of Don Ltd (Pty) for the year o February 2021 Supply brief reasons for each item to support your answer an reasons where there are no tax implications or adjustments. Begin your answer with net profit per the accounting statement comprehensive income. Ignore VAT throughout. Logical layout and presentation (1). mprovements were completed at a cost of N$150 000 and May 2020. a) Don Ltd (Pty) contributes towards a pension fund on behal Commissioner regards Don's approved remuneration as NS d) Included in Don's outstanding accounts receivable are dou The previous year's amount of doubtful debts was N$25 00 10% of the doubtful debts as an allowance. e) Don Ltd (Pty) purchased two patents. Patent A was acquire 30th September 2010, and its probable duration of use was Patent 8 was purchased at a cost of N$30 000 on 31st Ma of 10 years. 0 On 1st July 2020 Don Ltd (Pty) paid an amount of N$80 000 of its former employees, as a restraint of trade paymente full amount will be included in the recipient's gross income. g) Legal fees were incurred in drawing up the lease agreemer h) Lucas, an employee was injured whilst at work and could duties. He received an annuity of N$4 000 per month from 1 on 31st December 2020 because of the accident and an month was paid to his widow from the following month. Required: Calculate the taxable income of Don Ltd (Pty) for the year o February 2021 Supply brief reasons for each item to support your answer an reasons where there are no tax implications or adjustments. Begin your answer with net profit per the accounting statement comprehensive income. Ignore VAT throughout. Logical layout and presentation (1). mprovements were completed at a cost of N$150 000 and May 2020. a) Don Ltd (Pty) contributes towards a pension fund on behal Commissioner regards Don's approved remuneration as NS d) Included in Don's outstanding accounts receivable are dou The previous year's amount of doubtful debts was N$25 00 10% of the doubtful debts as an allowance. e) Don Ltd (Pty) purchased two patents. Patent A was acquire 30th September 2010, and its probable duration of use was Patent 8 was purchased at a cost of N$30 000 on 31st Ma of 10 years. 0 On 1st July 2020 Don Ltd (Pty) paid an amount of N$80 000 of its former employees, as a restraint of trade paymente full amount will be included in the recipient's gross income. g) Legal fees were incurred in drawing up the lease agreemer h) Lucas, an employee was injured whilst at work and could duties. He received an annuity of N$4 000 per month from 1 on 31st December 2020 because of the accident and an month was paid to his widow from the following month. Required: Calculate the taxable income of Don Ltd (Pty) for the year o February 2021 Supply brief reasons for each item to support your answer an reasons where there are no tax implications or adjustments. Begin your answer with net profit per the accounting statement comprehensive income. Ignore VAT throughout. Logical layout and presentation (1). mprovements were completed at a cost of N$150 000 and May 2020. a) Don Ltd (Pty) contributes towards a pension fund on behal Commissioner regards Don's approved remuneration as NS d) Included in Don's outstanding accounts receivable are dou The previous year's amount of doubtful debts was N$25 00 10% of the doubtful debts as an allowance. e) Don Ltd (Pty) purchased two patents. Patent A was acquire 30th September 2010, and its probable duration of use was Patent 8 was purchased at a cost of N$30 000 on 31st Ma of 10 years. 0 On 1st July 2020 Don Ltd (Pty) paid an amount of N$80 000 of its former employees, as a restraint of trade paymente full amount will be included in the recipient's gross income. g) Legal fees were incurred in drawing up the lease agreemer h) Lucas, an employee was injured whilst at work and could duties. He received an annuity of N$4 000 per month from 1 on 31st December 2020 because of the accident and an month was paid to his widow from the following month. Required: Calculate the taxable income of Don Ltd (Pty) for the year o February 2021 Supply brief reasons for each item to support your answer an reasons where there are no tax implications or adjustments. Begin your answer with net profit per the accounting statement comprehensive income. Ignore VAT throughout. Logical layout and presentation (1)