Zara Rose commenced a florist shop business on 1 January 2016 The income statement in respect of the business for the period from 1 January 2020 to 31 December 2020 is as follows Notes RM RM Income Sales in Cash Credit 190,000 Dividend 1,200 Insurance recovery for loss of inventory 70,000 Profit on sale of fixed assets 3,100 264,300 Less Expenses Cost of products 37,200 Salary 1 81,200 Leave passage 2 9,000 Bad and doubtful debts 3 1,430 Entertainment 4 16,000 Repairs 5 12,700 Insurance premium 6 2,400 Fines 7 1,030 Sundry expenses 8 25,060 Purchase of a furniture and fittings 23,150 (209,170) Net profit 55,130 Notes Salary includes RM40,000 for proprietor and RM41,200 for staff Leave passage includes cost incurred for proprietor (RM3,000) and staff (RM6,000) Bad and doubtful debts charged to income statement by Zara amounted to RM600 and RM830, respectively Entertainment expenses are incurred for holding a Family Day for the staffs and entertainment of flower suppliers, amounted to RM13,000 and RM3,000, respectively Repairs include RM550 for the cost of essential repairs to newly acquired equipment which could not be used until repairs had been carried out It also includes the cost of RM12,150 incurred constructing a new and improved display cabinets for the shop The cost of repairing the old cabinets would have been higher Insurance premium in respect of insurance policies against fire and loss of profits by the business Fines imposed on the business for repeated offences of over speeding by delivery staff Such practice is necessary to increase the profitability of the business Sundry expenses are as follows RM Depreciation 460 Promotional gifts (vase with business logo) 2,388 Shop rental 16,500 Motor vehicle expenses 5,712 25,060 Based on the information given you are required to compute the amount of adjusted business income of Ms Zara Rose under Section 4(a) of ITA 1967 for the year of assessment 2020, starting with the net profit of the business

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Zara Rose commenced a florist shop business on 1 January 2016. The income statement in respect of the business for the period from 1 January

Zara Rose commenced a florist shop business on 1 January 2016. The income statement in respect of the business for the period from 1 January 2020 to 31 December 2020 is as follows:

	Notes	RM	RM
Income
Sales in Cash & Credit			190,000
Dividend			1,200
Insurance recovery for loss of inventory			70,000
Profit on sale of fixed assets			3,100
			264,300
Less: Expenses
Cost of products		37,200
Salary	1	81,200
Leave passage	2	9,000
Bad and doubtful debts	3	1,430
Entertainment	4	16,000
Repairs	5	12,700
Insurance premium	6	2,400
Fines	7	1,030
Sundry expenses	8	25,060
Purchase of a furniture and fittings		23,150
			(209,170)
Net profit			55,130

Notes:

Salary includes RM40,000 for proprietor and RM41,200 for staff.

Leave passage includes cost incurred for proprietor (RM3,000) and staff (RM6,000).

Bad and doubtful debts charged to income statement by Zara amounted to RM600 and RM830, respectively.

Entertainment expenses are incurred for holding a Family Day for the staffs and entertainment of flower suppliers, amounted to RM13,000 and RM3,000, respectively.

Repairs include RM550 for the cost of essential repairs to newly acquired equipment which could not be used until repairs had been carried out. It also includes the cost of RM12,150 incurred constructing a new and improved display cabinets for the shop. The cost of repairing the old cabinets would have been higher.

Insurance premium in respect of insurance policies against fire and loss of profits by the business.

Fines imposed on the business for repeated offences of over speeding by delivery staff. Such practice is necessary to increase the profitability of the business.

Sundry expenses are as follows:

	RM
Depreciation	460
Promotional gifts (vase with business logo)	2,388
Shop rental	16,500
Motor vehicle expenses	5,712
	25,060

Based on the information given you are required to compute the amount of adjusted business income of Ms Zara Rose under Section 4(a) of ITA 1967 for the year of assessment 2020, starting with the net profit of the business.