Unit: Public Finance and Taxation
16 Questions| Sh. | ||
| 1 | Sales to the local market | 3,400,000 |
| Sales to foreign market | 5,000,000 | |
| Exempt sales | 2,350,000 | |
| 2 | Purchases and expenses incurred during the month were as follows: | Sh. |
| Cash purchases | 1,300,000 | |
| Credit purchases | 2,250,000 | |
| Salaries and wages | 1,800,000 | |
| Legal services | 650,000 | |
| Stationery | 720,000 | |
| Warehouse rent | 400,000 | |
| Security services | 680,000 | |
| Purchase of computers | 120,000 | |
| 3 | The above transactions are stated exclusive of VAT at the rate of 16%. |
| Sh. | ||
| Commuter allowance | 180,000 | |
| Meals | 35,000 | |
| Residence telephone bills | 60,000 | |
| Entertainment allowance | 120,000 |
| Sh. | Sh. | |
| Sales | 17,940,000 | |
| Opening stock | 1,245,000 | |
| Purchases | 9,887,000 | |
| Closing stock | (2,162,000) | (8,970,000) |
| Gross profit | 8,970,000 | |
| Profit on sale of furniture | 1,359,300 | |
| Insurance compensation for stolen car | 713,000 | |
| Discount received | 382,100 | |
| Farming income | 192,050 | |
| Dividend income (net) | 517,500 | |
| 12,133,950 | ||
| Less Expenses: | ||
| Mortgage interest | 552,000 | |
| Furniture at cost | 138,000 | |
| Depreciation | 529,000 | |
| General expenses | 3,243,000 | |
| Salaries and wages | 4,357,000 | |
| Custom duty | 209,300 | |
| Conveyance fee | 195,500 | |
| Legal expenses | 1,867,500 | |
| Repair and maintenance | 2,070,000 | |
| Value Added Tax (VAT) paid | 94,300 | |
| Interest on capital | 959,100 | |
| Bank charges | 138,000 | |
| Rent and rates | 377,200 | |
| Auditing and accountancy fees | 529,000 | |
| Motor vehicle expenses | 486,220 | |
| Insurance premiums | 441,600 | (16,186,720) |
| Net loss | (4,052,770) |
| 1 | Mortgage interest related to a partners residential house. |
| 2 | Insurance premiums include Sh.259,900 paid to insure Wekesa's private car. |
| 3 | The investment allowances were agreed with the revenue authority at Sh.1,357,000 during the year ended 31 December 2021. |
| 4 | The partners took goods for personal use which have recorded as sales which had a cost price of Sh.207,000. The gross profit margin was 20%. |
| 5 | Salaries and wages included: | Sh. |
| Kalebu | 1,035,000 | |
| Wekesa | 1,380,000 | |
| Babu | 1,150,000 | |
6 | Interest on capital comprised: | Sh. |
| Kalebu | 374,900 | |
| Wekesa | 170,200 | |
| Babu | 414,000 | |
7 | Legal fees included: | Sh. |
| Preparation of tender document | 287,500 | |
| Parking fines paid to county government | 138,000 | |
| Court charges for breach of contract | 368,000 | |
| Appeal against tax assessment | 75,000 | |
| Defending a partner in a local committee | 216,200 | |
8 | General expenses included: | Sh. |
| Embezzlement by cashier | 678,000 | |
| Registration of trademark | 337,500 | |
| Office partition | 510,000 | |
| Directors' christmas party | 575,000 | |
9 | Repairs and maintenance comprised of: | Sh. |
| New office tables | 280,000 | |
| Laptops and computers | 430,000 | |
| Fixing broken chairs and tables | 116,000 |
| Sh. | |
| Factory building | 6,600,000 |
| Processing Machinery (cost, insurance and freight) | 3,800,000 |
| Delivery van | 1,908,000 |
| Tractor | 1,448,000 |
| Photocopier | 450,000 |
| Generator | 720,000 |
| Go-down | 1,500,000 |
| Workshop machinery | 840,000 |
| Computers | 660,000 |
| Saloon car | 3,840,000 |
| Fax machine | 280,000 |
| 1 | Processing machinery was imported from China and the company received an import duty waiver of 25% on the value of the machinery for duty from Government. The VAT rate was 16%. |
| 2 | Factory building include the cost of clinic Sh.420,000, showroom Sh.580,000 and a retail shop Sh.600,000. |
| 3 | A perimeter wall was constructed at a cost of Sh.540,000 and put into use on 1 September 2021. |
| 4 | The company sunk a borehole at a cost of Sh.300,000 which was utilised from 1 October 2021. A water pump costing Sh.45,000 was purchased and utilised from the same date. |
| 5 | On 1 November 2021, the following assets were acquired: |
| 5 | Sh. | |
| Conveyor belts | 680,000 | |
| Surveillance cameras | 120,000 | |
| Water tank | 150,000 |
| 6 | A sport pavilion and a staff canteen were constructed at a cost of Sh.780,000 and Sh.1,280,000 respectively and used with effect from 1 December 2021. |
| 7 | The Saloon car was disposed of at Sh.1,920,000 in December 2021. |
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