- 20 Marks
Question
As part of the induction program for the newly recruited staff of your firm of tax consultants, you have been tasked with a presentation on companies’ income tax computation for beginners during the firm’s training session.
You are provided with the following information relating to Wizzy-Baddo Limited, which commenced business on September 1, 2020:
- Adjusted Profit:
- Period to December 31, 2020: N6,937,500
- Year ended December 31, 2021: N9,300,500
The following assets were acquired as follows:
| Date | Asset | Cost (N) |
|---|---|---|
| June 5, 2020 | Land and building | 5,467,500 |
| July 1, 2020 | Motor vehicle | 10,000,000 |
| October 15, 2020 | Machinery | 4,375,000 |
| February 28, 2021 | Furniture | 3,458,000 |
| May 1, 2021 | Delivery van | 4,750,000 |
Required:
a. State the basis periods for assessable profits and qualifying capital expenditure. (5 Marks)
b. Compute the capital allowances.
Answer
- Topic: Companies Income Tax (CIT)
- Series: MAY 2023
- Uploader: Theophilus