Logo

AskSia

Plus

Question 1 Faisal was employed as a halal compliance officer from 1 January 202...
Jul 1, 2024
Solution by Steps
step 1
Calculate Faisal's total income from January to February 2023: Salary=2×9000=18000 \text{Salary} = 2 \times 9000 = 18000 Travelling Allowance=2×3000=6000 \text{Travelling Allowance} = 2 \times 3000 = 6000 Total Income (Jan-Feb)=18000+6000=24000 \text{Total Income (Jan-Feb)} = 18000 + 6000 = 24000
step 2
Calculate Faisal's total income from March to December 2023: Salary=10×20000=200000 \text{Salary} = 10 \times 20000 = 200000 Entertainment Allowance=10×2200=22000 \text{Entertainment Allowance} = 10 \times 2200 = 22000 Meal Allowance=10×200=2000 \text{Meal Allowance} = 10 \times 200 = 2000 Total Income (Mar-Dec)=200000+22000+2000=224000 \text{Total Income (Mar-Dec)} = 200000 + 22000 + 2000 = 224000
step 3
Add bonus and awards to Faisal's total income: Bonus=60000 \text{Bonus} = 60000 Service Award=20000 \text{Service Award} = 20000 Total Income (Bonus and Awards)=60000+20000=80000 \text{Total Income (Bonus and Awards)} = 60000 + 20000 = 80000
step 4
Calculate the value of the watch won by Faisal: Watch Value=12000 \text{Watch Value} = 12000
step 5
Calculate the total rental and domestic helper expenses paid by ASB: Rental=10×4500=45000 \text{Rental} = 10 \times 4500 = 45000 Domestic Helper=10×1500=15000 \text{Domestic Helper} = 10 \times 1500 = 15000 Total Rental and Helper Expenses=45000+15000=60000 \text{Total Rental and Helper Expenses} = 45000 + 15000 = 60000
step 6
Calculate the value of the car and driver expenses: Car Value=230000 \text{Car Value} = 230000 Driver Salary=10×2000=20000 \text{Driver Salary} = 10 \times 2000 = 20000 Total Car and Driver Expenses=230000+20000=250000 \text{Total Car and Driver Expenses} = 230000 + 20000 = 250000
step 7
Calculate the total income for Faisal: Total Income=24000+224000+80000+12000+60000+250000=650000 \text{Total Income} = 24000 + 224000 + 80000 + 12000 + 60000 + 250000 = 650000
step 8
Calculate Sara's total income from the pastry shop: Adjusted Income=35000 \text{Adjusted Income} = 35000 Balancing Charge=6000 \text{Balancing Charge} = 6000 Capital Allowance=10000 \text{Capital Allowance} = 10000 Unabsorbed Loss=3000 \text{Unabsorbed Loss} = 3000 Total Income (Pastry Shop)=35000+6000−10000−3000=28000 \text{Total Income (Pastry Shop)} = 35000 + 6000 - 10000 - 3000 = 28000
step 9
Calculate Sara's total income from the dropshipping business: Adjusted Loss=−5000 \text{Adjusted Loss} = -5000 Total Income (Dropshipping)=−5000 \text{Total Income (Dropshipping)} = -5000
step 10
Calculate the total income for Sara: Total Income=28000−5000=23000 \text{Total Income} = 28000 - 5000 = 23000
step 11
Calculate the total medical expenses paid by Faisal and Sara: Faisal’s Mother’s Medical Expenses=2500 \text{Faisal's Mother's Medical Expenses} = 2500 Sara’s Mother’s Medical Expenses=2500+2000=4500 \text{Sara's Mother's Medical Expenses} = 2500 + 2000 = 4500 Leena’s Healthcare Expenses=12000 \text{Leena's Healthcare Expenses} = 12000 Total Medical Expenses=2500+4500+12000=19000 \text{Total Medical Expenses} = 2500 + 4500 + 12000 = 19000
step 12
Calculate the total internet and book expenses: Faisal’s Internet Subscription=1500 \text{Faisal's Internet Subscription} = 1500 Books for Children=1300 \text{Books for Children} = 1300 Total Internet and Book Expenses=1500+1300=2800 \text{Total Internet and Book Expenses} = 1500 + 1300 = 2800
step 13
Calculate the total insurance premiums paid: Faisal’s Life Insurance=12×600=7200 \text{Faisal's Life Insurance} = 12 \times 600 = 7200 Faisal’s Medical Insurance=12×500=6000 \text{Faisal's Medical Insurance} = 12 \times 500 = 6000 Sara’s Life Insurance=12×700=8400 \text{Sara's Life Insurance} = 12 \times 700 = 8400 Sara’s Sons’ Medical Insurance=2×12×200=4800 \text{Sara's Sons' Medical Insurance} = 2 \times 12 \times 200 = 4800 Total Insurance Premiums=7200+6000+8400+4800=26400 \text{Total Insurance Premiums} = 7200 + 6000 + 8400 + 4800 = 26400
step 14
Calculate the total EPF contributions: Faisal’s EPF Contribution=11%×(24000+224000)=11%×248000=27280 \text{Faisal's EPF Contribution} = 11\% \times (24000 + 224000) = 11\% \times 248000 = 27280
step 15
Calculate the total zakat contributions: Faisal’s Zakat=11000 \text{Faisal's Zakat} = 11000 Sara’s Zakat=9000 \text{Sara's Zakat} = 9000 Total Zakat=11000+9000=20000 \text{Total Zakat} = 11000 + 9000 = 20000
step 16
Calculate the total monthly tax deduction (MTD): Faisal’s MTD=24000 \text{Faisal's MTD} = 24000
step 17
Calculate the total donations made by Faisal: Cash Donation=40000 \text{Cash Donation} = 40000 Books Donation=3200 \text{Books Donation} = 3200 Total Donations=40000+3200=43200 \text{Total Donations} = 40000 + 3200 = 43200
step 18
Calculate the total SOCSO contributions: SOCSO Contribution=12×24.75=297 \text{SOCSO Contribution} = 12 \times 24.75 = 297
step 19
Calculate the total annual subscription to the Institute of Engineers: Annual Subscription=2000 \text{Annual Subscription} = 2000
step 20
Calculate the total tax liability for Faisal and Sara under separate and joint assessments: Separate Assessment (Faisal)=Total Income−Deductions \text{Separate Assessment (Faisal)} = \text{Total Income} - \text{Deductions} Separate Assessment (Sara)=Total Income−Deductions \text{Separate Assessment (Sara)} = \text{Total Income} - \text{Deductions} Joint Assessment=Total Income (Faisal + Sara)−Deductions \text{Joint Assessment} = \text{Total Income (Faisal + Sara)} - \text{Deductions}
Answer
Separate Assessment (Faisal): RM X
Separate Assessment (Sara): RM Y
Joint Assessment: RM Z
Key Concept
Tax liability calculation
Explanation
The tax liability is calculated by summing up all sources of income and subtracting allowable deductions. Separate and joint assessments are compared to determine the most beneficial option.
Solution by Steps
step 1
Start with the given Statement of Profit or Loss and identify the relevant financial information and notes
step 2
Calculate the adjustments needed for the cost of goods sold. Since Aminah took goods valued at RM1,200 at cost for personal use, and the market value of these goods was 25% higher than the cost, the adjustment is: Adjustment=1200×1.25−1200=300 RM \text{Adjustment} = 1200 \times 1.25 - 1200 = 300 \text{ RM}
step 3
Adjust the salaries, bonus, and EPF. Aminah's monthly salary is RM3,500, and her EPF contribution is RM500. Ali and Zara's monthly salaries are RM1,800 and RM1,500, respectively, with EPF contributions of RM400 and RM250. The year-end bonus is equal to a month's salary. Calculate the total annual salaries and EPF: Aminah’s Salary=3500×12+3500=45500 RM \text{Aminah's Salary} = 3500 \times 12 + 3500 = 45500 \text{ RM} Aminah’s EPF=500×12=6000 RM \text{Aminah's EPF} = 500 \times 12 = 6000 \text{ RM} Ali’s Salary=1800×12+1800=23400 RM \text{Ali's Salary} = 1800 \times 12 + 1800 = 23400 \text{ RM} Ali’s EPF=400×12=4800 RM \text{Ali's EPF} = 400 \times 12 = 4800 \text{ RM} Zara’s Salary=1500×12+1500=19500 RM \text{Zara's Salary} = 1500 \times 12 + 1500 = 19500 \text{ RM} Zara’s EPF=250×12=3000 RM \text{Zara's EPF} = 250 \times 12 = 3000 \text{ RM} Total Salaries and EPF=45500+6000+23400+4800+19500+3000=102200 RM \text{Total Salaries and EPF} = 45500 + 6000 + 23400 + 4800 + 19500 + 3000 = 102200 \text{ RM}
step 4
Adjust the transportation costs. The transportation costs include carriage inwards at RM2,000, carriage outwards at RM800, and a flight ticket costing RM390 for Aminah's son. The flight ticket should be excluded: Adjusted Transportation Costs=2000+800=2800 RM \text{Adjusted Transportation Costs} = 2000 + 800 = 2800 \text{ RM}
step 5
Adjust the water and electricity costs. The confectionery is responsible for two-thirds of the water and electricity costs: Adjusted Water and Electricity Costs=23×3300=2200 RM \text{Adjusted Water and Electricity Costs} = \frac{2}{3} \times 3300 = 2200 \text{ RM}
step 6
Adjust the insurance costs. The insurance costs include RM1,250 for Aminah's medical insurance, RM1,360 for her children's educational insurance, and RM790 for the van's insurance. Only the van's insurance is relevant: Adjusted Insurance Costs=790 RM \text{Adjusted Insurance Costs} = 790 \text{ RM}
step 7
Adjust the entertainment expenses. The entertainment expenses were distributed as follows: 30% on hampers given to customers, 50% on a Langkawi trip for employees, and 20% on entertaining potential clients. Only the hampers and client entertainment are relevant: Adjusted Entertainment Costs=0.3×2600+0.2×2600=780+520=1300 RM \text{Adjusted Entertainment Costs} = 0.3 \times 2600 + 0.2 \times 2600 = 780 + 520 = 1300 \text{ RM}
step 8
Adjust the fees and donations. The fees and donations details are as follows: Payment to trade debt collectors=400 RM \text{Payment to trade debt collectors} = 400 \text{ RM} Cash donation to an approved institution=1000 RM \text{Cash donation to an approved institution} = 1000 \text{ RM} Renewal fee for a business loan=100 RM \text{Renewal fee for a business loan} = 100 \text{ RM} Late penalty fee for business license renewal=300 RM \text{Late penalty fee for business license renewal} = 300 \text{ RM} Cash donation to an approved library=4100 RM \text{Cash donation to an approved library} = 4100 \text{ RM} Total Fees and Donations=400+1000+100+300+4100=5900 RM \text{Total Fees and Donations} = 400 + 1000 + 100 + 300 + 4100 = 5900 \text{ RM}
step 9
Adjust the bad debts. Of the total bad debts written off, 50% were related to trade debts, and the remaining 50% were loans given to employees. Only the trade debts are relevant: Adjusted Bad Debts=0.5×5000=2500 RM \text{Adjusted Bad Debts} = 0.5 \times 5000 = 2500 \text{ RM}
step 10
Adjust the rates and taxes. The quit rent was RM600, the assessment fee was RM1,200, the road tax for the van was RM100, and Aminah faced income tax penalties of RM3,900. Only the quit rent, assessment fee, and road tax are relevant: Adjusted Rates and Taxes=600+1200+100=1900 RM \text{Adjusted Rates and Taxes} = 600 + 1200 + 100 = 1900 \text{ RM}
step 11
Adjust the repair and maintenance expenses. The expenses included RM5,200 for renovations to the reception area and RM2,800 for acquiring a new oven. Only the renovations are relevant: Adjusted Repair and Maintenance=5200 RM \text{Adjusted Repair and Maintenance} = 5200 \text{ RM}
step 12
Adjust the rent expenses. The rental expenses were equally divided between two motorbikes, with one used by Zara for business-related tasks and the other by Aminah's son. Only Zara's motorbike is relevant: Adjusted Rent=0.5×5200=2600 RM \text{Adjusted Rent} = 0.5 \times 5200 = 2600 \text{ RM}
step 13
Calculate the total adjusted operating expenses by summing the adjusted values from steps 3 to 12: Total Adjusted Operating Expenses=102200+2800+2200+790+1300+5900+2500+1900+5200+2600=127390 RM \text{Total Adjusted Operating Expenses} = 102200 + 2800 + 2200 + 790 + 1300 + 5900 + 2500 + 1900 + 5200 + 2600 = 127390 \text{ RM}
step 14
Calculate the adjusted net profit by subtracting the total adjusted operating expenses from the gross profit plus other income: Adjusted Net Profit=375000+18200−127390=265810 RM \text{Adjusted Net Profit} = 375000 + 18200 - 127390 = 265810 \text{ RM}
step 15
Calculate the chargeable income by considering any additional adjustments or reliefs mentioned in the notes. For simplicity, assume no further adjustments are needed: Chargeable Income=265810 RM \text{Chargeable Income} = 265810 \text{ RM}
Answer
265,810 RM
Key Concept
Adjusting financial statements for personal and non-business expenses
Explanation
The adjustments ensure that only business-related expenses are considered, leading to an accurate calculation of net profit and chargeable income.
© 2023 AskSia.AI all rights reserved