TAXATION OF PARTNERSHIP IN TRINIDAD & TOBAGO

Mendez and Marshall are in partnership sharing profits and losses 60:40.

The following is the trial balance as at 30 June 2010.

Particulars	Debit $	Credit $
Buildings (Cost $750,000.00)	500,000.00
Fixtures at cost	110,000.00
Provision for depreciation: Fixtures		33,000.00
Debtors	162,430.00
Creditors		111,500.00
Cash at bank	67,700.00
Stock at 30 June 2009	419,790.00
Sales		1,236,500.00
Purchases	854,160.00
Carriage outwards	12,880.00
Discounts allowed	1,150.00
Loan interest: King	40,000.00
Office expenses	24,160.00
Salaries and wages	189,170.00
Bad debts	50,300.00
Provision for bad debts		40,000.00
Loan from J. King		400,000.00
Capitals: Mendez		350,000.00
Marshall		295,000.00
Current accounts: Mendez		13,060.00
Marshall		29,800.00
Drawings: Mendez	64,000.00
Marshall	56,500.00

Notes

a. Stock, 30 June 2010, $563,400.00

b. Expenses to be accrued: Office Expenses $9,600.00, Wages $2,000.00

c. Depreciate fixtures and buildings using 10 percent on the reducing balance basis

d. The partners agree institute a capital allowance policy similar to the depreciation policy

e. Partnership salary of $8,000.00 to Mendez not yet entered

f. Marshall took 15% of the purchases during the year for his extended family

g.Marshalls wife took out a loan from a family friend John King where she made a down payment on Marshalls personal car. Note that this car is used in the business occasionally.

a. Prepare a trading and profit and loss account for the year ended 30 June 2010, and then share the profit using the profit sharing ratio. (10 Marks)

b. Compute the tax liability for Mendez and Marshall for the year of assessment 2010. (5 Marks)

I am not sure what the additional information needed is? please specify