KASNEB Public Finance and Taxation - Question 1a

Summarise five roles of the County Assembly in public finance management. ... [Click to view full question and step-by-step solution]

KASNEB Public Finance and Taxation - Question 1b

Propose five sources of revenue for county governments. ... [Click to view full question and step-by-step solution]

KASNEB Public Finance and Taxation - Question 5b

Summarise four factors which could influence the extent of tax shifting. ... [Click to view full question and step-by-step solution]

CPA Public Finance and Taxation November 2019 Past Paper with Answers (PDF)

Q: KASNEB Public Finance and Taxation - Question 3a

In a tax seminar one of the facilitators noted that, 'The Tax Procedures Act 2015. specifies on that the Commissioner should include in the default assessmen... [Click to view full question and step-by-step solution]

1a

Oversight Function in Public Finance Management

Summarise five roles of the County Assembly in public finance management.

View Similar Exam Questions

1b

Relationship between National and County Governments on budget and economic matters

Propose five sources of revenue for county governments.

View Similar Exam Questions

1c

Relationship between National and County Governments on budget and economic matters

Outline the stages to be followed in the budget process for the National Government in any financial year.

View Similar Exam Questions

2a

Procurement in public entities

Identify three ad hoc committees that a county procuring entity could establish to ensure that procurement and asset disposal is done in accordance with the County Governments Procurement Regulations.

View Similar Exam Questions

2b

Procurement in public entities

Discuss five roles of the National Treasury in relation to procurement and asset disposal as outlined in the Public Procurement and Asset Disposal Act.

View Similar Exam Questions

2c

Administration of Value Added Tax (VAT)

The following are summaries of the details of the sales day book, purchases day book and the cash book of Kamata Ltd. for the month of December 2018:

Sales Day Book

Date	Details	Folio	Amount (Sh.)
December 4	Mwangaza Ltd.	1002	650,000
7	J. Kamau	1003	520,000
14	Hazina Enterprises (export)	1004	350,000
20	Ministry of Sports	1005	170,000
	Total		1,690,000

Purchases Day Book

Date	Details	Folio	Amount (Sh.)
December 1	Jawabu Enterprise	2004	300,000
6	Sonytec Ltd. (imports)	2006	420,000
12	N. Kaluma	2007	200,000
27	B. Salama	2008	180,000
	Total		1,100,000

Dr				Cr
Date	Details	Cash	Bank	Date	Details	Cash	Bank
December		Sh.	Sh.	December		Sh.	Sh.
5	Sales	960,000	450,000	2	Salaries and wages		1,800,000
15	Receipt from debtors	800,000	4,200,000	4	Catering expenses	120,000
				5	Purchases	580,000	640,000
				7	Furniture		160,000
				9	Electricity	32,000
				14	Photocopying	24,000
				22	Refund to customers		176,000
				30	Balance c/d	1,004,000	1,874,000
		1,760,000	4,650,000			1,760,000	4,650,000

Additional information:

1	J. Kamauwas declared bankrupt on 18 December 2018 after having paid Sh.400,000 for the goods purchased on 7 December 2018.
2	Ten per cent of the purchase from Jawabu Enterprises were returned by the company due to poor quality.
3	Credit notes amounting to Sh.280,000 were issued to customers during the month.
4	Refund to the customers in the cashbook relates to the excess amounts paid on cash sales.
5	A purchase invoice of Sh.220,000 from Dubai Traders was omitted from the purchases daybook.
6	All the above transactions are exclusive of VAT at the standard rate of 16%

Required:

Prepare a VAT account for the month of December 2018 showing the VAT payable or refundable, if any.

View Similar Exam Questions

3a

Administration of Income Tax and Tax Procedures

In a tax seminar one of the facilitators noted that, "The Tax Procedures Act 2015. specifies on that the Commissioner should include in the default assessment to a taxpayer".

With reference to the above statement, outline five categories of such information

View Similar Exam Questions

3b

Taxation of Income

Suleiman Kombo is employed as the Managing Director of Utamu Distributors Ltd., a tax exempt company. During the year ended 31 December 2018, he presented the following information:

1	His basic salary was Sh.120,000 per month (PAYE Sh. 48,000 per month).
2	He was provided with lunch by the employer from 1 August 2018 of Sh.4,800 per month.
3	He was provided with a fully furnished house fitted with water and electricity. The employer paid a monthly rent of Sh.45,000. He was deducted 10% of his basic monthly salary for rent. The cost of furniture was Sh.300,000 while the monthly electricity and water bills was Sh.3,500 and Sh.2,800 respectively.
4	The company paid for him life insurance premiums of Sh.6,000 per month for each member of his household from 1 September 2018. He had included himself, his wife and their son in the insurance policy.
5	He contributed 10% of his monthly pay towards a registered pension scheme while the employer contributed 15% of his basic pay towards the same scheme.
6	He enjoyed free medical treatment under a medical scheme operated by the company for all employees. His medical expenses were assessed at Sh.150,000 during the year.
7	During the year the company paid a total of Sh.35,000 as school fees for his son studying in a County School. This amount was not included in the company's income statement during the year.
8	On 1 August 2018, the company provided him with the following: - A Land Rover which was acquired at a cost of Sh.1,800,000 with an engine capacity of 3,000сc. - A gardener and a night watchman whose monthly salaries was Sh.12,500 and Sh.15,000 respectively.
9	He invested in real estate and earned a net rental income of Sh.72,000 after deducting the following expenditure:

		Sh.
	Caretaker's wages	120,000
	Fencing	40,000
	Loan repayment	320,000
	Insurance rent and rates	48,000
	Partitions	60,000
	Capital allowances	22,000
	Gross rental withholding tax paid	68,200

10	He received net dividends of Sh.42,500 from Maziwa Co-operative Society during the year.

Required:

(i) Total taxable income for Suleiman Kombo for the year ended 31 December 2018.

(ii) Tax payable (if any) from the income computed in (b) (i) above.

(iii) Comment on any information not used in your computations under (b) (i) above.

View Similar Exam Questions

4a

Investment Allowances/deductions

Dalbir Singh is a retired engineer. He set up a factory complex in industrial area on 30. September 2017 to fabricate mechanical and auto spare parts at a cost of Sh.48 million.

However, operations commenced on 1 January 2018.

The cost comprised the following:	Sh.
Factory building	18,750,000
Office (within the factory building)	6,250,000
Reinforcement of concrete floor to affix machinery	1,650,000
Land	Land
Architect's fee	2,430,000
Packing bay	99,000
Electrical wiring	1,480,000
Conveyer belt	1,200,000
Lifts and escalators	4,000,000
Special shafts for lifts	3,250,000
	48,000,000

Dalbir Singh provided the following additional information:

1	Additional structures and works constructed and utilised from 1 January 2018 were as follows:

		Sh.
	- Residential house	960,000
	- Workplace nursery	1,200,000
	- Drawing and design room	720,000

2	To improve performance in the factory, an Oracle database that provides cloud service was installed at a cost of Sh.450,000. The computers in the drawing and design room had a Computer Aided Design (CAD) application installed at a cost of Sh.270,000.
3	A building that had been constructed at a cost of Sh.12,000,000 was leased from Jalaam Manufacturers Ltd. for five years. The annual lease rentals were agreed at Sh.2,800,000. Dalbir imported processing machinery from China at a cost of Sh.5,200,000 and installed it in the building.
4	Two warehouses were constructed at a cost of Sh.2,250,000 and utilised from 1 September 2018.
5	The following assets were purchased or constructed during the year:

		Sh.
	Furniture and fittings (including of Sh.220,000 for the workplace nursery)	620,000
	Library display fixtures (stocked with mechanical engineering volumes)	480,000
	Computers and electronic adding machines	840.000
	Motor vehicle (a second-hand BMW)	2,300,000
	Lorry (four tonnes)	1,800,000
	Tuktuk for the messenger	180,000
	Backhoe loader	3,680,000
	Additional processing machinery	9,000,000
	Mobile crane	1,900,000

Required:

Capital allowances due to Dalbir Singh for the year ended 31 December 2018.

View Similar Exam Questions

4b

Taxation of Income

The following information has been extracted from the records of LathermanCo. Ltd. who are regional suppliers of electronic equipment and appliances, for the year ended 31 December 2018:

	Sh.
Operating profit before tax and other income	3,800,000
Investment income	849,500
Leasing of electronic equipment	50,000
Rental income	346,000

Additional information is provided as follows:

1	Investment income comprises of the following:
			Sh.
	Interest income:	Post Bank (K) Ltd.	138,000
		Fixed deposit accounts with Luanda Bank	246,500 (Net)
		Savings accounts	170,000 (Net)
			200,000 (Gross)
			95,000 (Net)
			849,500

2	Rental income is arrived at after deducting the following expenses among others:

		Sh.
	Mortgage interest on property	10,000
	Purchase of water meters	28,000
	Caretaker's salary	36,000
	Replacing iron sheet roofing with the tile roofing	120,000
	Withholding tax on rental income	60,000

3	The following expenses were considered before arriving at the operating profit before tax and other income:

		Sh.
	Salaries and wages	840,000
	Retirement fund contribution (with Sh.80,000 to registered funds)	150,000
	Depreciation	400,000
	Bank interest	180,000
	Provision for bad debts	10,000
	Legal and professional fees	108,000
	Repairs and maintenance	40,000
	Sundry expenses	150,000
	Donations	150,000
	Compensation	92,000
	Instalment tax paid for the previous year	900,000
	Construction of the watchmen's booth at the gate	240,000

4	Salaries and wages comprised: Directors allowances Sh.300,000, director's watchmen salary Sh.40,000 and salaries to other staff Sh.500,000.
5	Bank interest includes that of an overdraft taken by a senior manager of Sh.40,000, on the managing director's residential house mortgage Sh.60,000 and the rest on bank loan.
6	Provision for bad debts is made up as follows:

	Sh.		Sh.
Bad debts written off: Customers	10,000	Balance brought forward: 3% of accounts receivable	8,000
Staff	14,000	Balance brought forward: Specific bad debts	30,000
Balance carried down:
2% of accounts receivable	9,000	Bad debts recovered	5,000
Specific bad debts	20,000	Income statement	10,000
	53,000		53,000

7	Legal and professional fees comprise:

	Collection of trade debts	Sh. 20,000
	Renewal of lease (99 years)	3,000
	Accounting fee	35,000
	Auditing fee	15,000
	Tax appeal	30,000
	Staff loan collection	5,000
		108,000

	Auditing fee relates to an enquiry by the Revenue Authority which revealed discrepancies that led to higher tax liability and penalties.
8	Sundry expenses constitute staff Christmas party Sh.17,000, tax penalty for late filing Sh.3,000, school fees Sh.40,000 and other allowable expenses of Sh.90,000. School fees was for a director's son and the company agreed not to debit it in the income statement.
9	Donations were to the County Governor's political campaign kitty.
10	Compensation was to a staff member who had not been issued with safety equipment and uniform as he carried out work at a client's premise leading to him being badly injured.

Required:

The adjusted taxable income of Latherman Co. Ltd. for the year ended 31 December 2018.

View Similar Exam Questions

5a

Customs Taxes and Excise Taxes

Explain each of the following terms as used under custom taxes

(i) Clean report of findings

(ii) Import declaration form.

View Similar Exam Questions

5b

Introduction to Taxation

Summarise four factors which could influence the extent of tax shifting.

View Similar Exam Questions

5c

Taxation of Income

Teddy, Racheal and Michael are partners trading under the name Teram Enterprises. They share profits and losses in the ratio of 4:3:3. The partners have presented the following income statement for the year ended 31 December 2018:

	Sh.
Salaries and wages	280,000	Gross profit	2,300,000
Rent, rates and taxes	150,000	Miscellaneous income	150,000
Office expenses	204,000	Discounts	80,000
Printing and stationery	64,000	Farming income	132,000
Instalment tax paid	45,000	Profit on sale of shares	100,000
Advertising	73,000	Interest on deposits	120,000
Interest on capital:
Teddy	60,000
Racheal	70,000
Michael	80,000
Michael
Commission to partners:
Teddy	45,000
Michael	35,000
Depreciation	92,000
Bad debts	68,000
General expenses	99,000
Donation to famine relief	100,000
General reserve	120,000
Local taxes on property	12,000
Electricity	46,000
Showroom expenses	117,000
Net profit	1,040,000
	2,882,000		2,882,000

Additional information:

1. It has been the firm's practice to value the stocks at the cost price, however, the closing stock amounting to Sh.180,000 was valued based on net realisable value which is 10% less of its cost price.

2. Salaries and wages include salaries amounting to Sh.40,000 paid to Racheal.

3. Advertising includes Sh.10,000 spent on advertising campaign to introduce a new product in the market.

4. Legal fees include a sum of Sh.12,000 paid as parking fine and penalty to the county government.

5. Capital allowances have been agreed with the Commissioner of Income Tax at Sh.90,000.

6. Teddy's other income includes Sh.120,000 consultancy fee. He has brought forward partnership business loss of Sh.135,000 from the assessment of the year of income 2017.

7. Racheal has income of Sh.200,000 from bet winnings. She has brought forward partnership business loss of Sh.135,000 from assessment of the year of income 2017.

Required:

(i) Taxable profit or loss of the partnership for the year ended 31 December 2018.

(ii) Allocation schedule of profit or loss calculated in (c) (i) above.

(iii) Total taxable income of each of the partners for the year of income 2018.

View Similar Exam Questions

CPA Public Finance and Taxation – November 2019 Past Paper & Answers

Download Complete Period

Questions

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

CPA Public Finance and Taxation – November 2019 Past Paper & Answers

Download Complete Period

Questions

Other Public Finance and Taxation Past Papers

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?

Want to join the discussion?