You have been presented with a working paper calculating planning and performance materiality:

$\backslash$table$[[$Planning and performance materiality$],[$Client:$,$C the World,WP P$-1],[$Financial year$-$end:,$31$ March $2021,\backslash$table$[[$Prepared$],[$by:$]],$AJ Sepeng$],[\backslash$table$[[$Date$],[$prepared$]],15/4/2021],[$Section:$,\backslash$table$[[$Understanding of the entity and its$],[$environment$]],\backslash$table$[[$Reviewed$],[$by$]],],[\backslash$table$[[$Date$],[$Reviewed$]],],[\{$

$\backslash$table$[[$C the World was founded in April two years ago and its main business is a travel agency for international$],[$tours$.$ This will be the first year that an audit will be conducted on the financial statements. The previous$],[$year$\text{'}$s figures were independently reviewed by other external auditors and no concerns were highlighted$],[$in the review report. C the World earns between $5$ and $10\%$ commission on all tours.$],[$The entity is run by Lorraine Dichabe $($financial director$)$ and Mariaan Roos $($executive director$),$ who are$],[$also the founders and shareholders of the entity. Lorraine and Mariaan are planning to expand C the$],[$World rapidly and require the audited financial statements within two weeks after year$-$end to apply for$],[$additional funding from TNB bank. Previous communication from TNB bank stated that additional funding$],[$would be considered when healthy solvency and profitability indicators were achieved.$]]\}],[]]$

The directors provided you with the following extract from the financial statements:

Extracts from the financial statements

$\backslash$table$[[$Accounts$,31$ March $2021,31$ March $2020],[$Commission earned $($turnover$),$R$522749,$R$305285],[$Other expenses,R$95489,$R$76587],[$Total assets,R$157931,$R$125879],[$Total liabilities,R$105682,$R$117859]]$

During the $2021$ financial year, C the World was awarded a R$100000$ once$-$off contract to perform travel arrangements for a soccer team.

Your audit firm applies the following percentages in calculating planning materiality:

Turnover: $0\mathrm{.}5-1\%.$

Gross Profit: $1-2\%$

Profit before tax: $5-10\%$

Total assets: $1-2\%$

You are required to:

$1\mathrm{.}1$ Calculate and motivate the planning materiality to be used for the year ended $31$ March $2021.$