Texas CC carries on the business of manufacturing music instruments. It is not regarded as a small business corporation as defined in the Income Tax Act. The taxable income of the close corporation for the year of assessment ending 31 March 2016, before taking into account the items mentioned below, amounted to R5 800 000. Additional information Fixed asset obtained in prior years and still in use on 31 March 2016 Vehicles purchased new on 1 June 2010 for R120 000 Fixed assets obtained during the year Two small item assets with a collective cost of R4 500 were purchased on 30 November 2015. These items qualify for the section 11(e) wear-and-tear allowance. Manufacturing machine MM was purchased second hand on 1 June 2015 for R300 000 and brought into use at the same date. A new manufacturing machine LL was purchased on 1 February 2016 for R450 000 and brought into use on 1 March 2016. Manufacturing building AA was sold on 1 January 2015 for R5 000 000 and Notes CC had a recoupment of R800 000. It purchased a new manufacturing building ZZ for R9 000 000 on 1 April 2015 and brought it into use at the same date. The cost was made up as follows: Land R 1 000 000 Building R 9 000 000 Total R10 000 000 Repair of and extension to assets The roof of manufacturing building ZZ was badly damaged during a storm and needed to be replaced on 1 April 2015 at a cost of R220 000. Notes CC decided to extend the roof to allow for an undercover parking area for its employees. The cost of this extension amounted to R300 000. Fixed asset sold during the year On 30 November 2015, manufacturing machine PP costing R290 000 was sold for R310 000. This machine was purchased new on 30 June 2009. No transactions regarding this asset have been included in the taxable income calculation of R5 800 000 above. 2 Other information Binding general ruling No. 7 makes provision for the following write-off periods. Vehicles 5 years Undercover parking (carports) 5 years REQUIRED: Calculate the income tax liability of Texas CC for the year of assessment ending 31 March 2016. Note: The close corporation has elected to claim the section 11(o) allowance of the Income Tax Act, and to make use of the building recoupment set-off, where applicable