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Accountancy Forum The Profession Tax v
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Compute business income

 
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Compute business income
Excel
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#2
10-28-2010, 05:44 PM
TWO PORTIONS TO SOLVE THIS QUESTION

1- BUSINESS INCOME
2- AGRICULTUREAL INCOME


1-SOLUTION

SALES RS. 11,250,000

LESS COST OF SALES

MKT VALUE OF GOODS PRODUCED BY
THE COMPANY IS RS. 3,750,000*
RAW MATERIAL PURCHASED 2,250,000
MANUFACTURING EXPENSES 1,125,000
TOTAL COST OF SALES ( 7,125,000)

GROSS PROFIT 4,125,000

LESS OPERATING EXPENSES
SELLING + ADMIN + FINANCE COSTS (2,400,000)

NET PROFIT RS. 1,725,000

AGRICULTURAL INCOME

MKT VALUE OF GOODS PRODUCED AND USED AS RAW MATERIAL RS. 3,750,000
LESS EXPENSES ON AGRICULTURE (1,500,000)

NET AGRICULTURE INCOME RS. 2,250,000



NOTE* RULE 11 ( AGRICLUTURE PRODUCE AS RAW MATERIAL)

Where a cultivator or receiver of rent in kind uses the agriculture produce as raw material, in his business, then the income chargeable to tax under the head " INCOME FFROM BUSINESS" SHALL BE COMPUTED AS FOLLOW

TOTAL INCOME - MKT VALUE OF AGRICULTURE PRODUCE UTILIZED IN BUSINESS ARE RAW MATERIAL.

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Messages In This Thread
Compute business income - by skystar - 10-28-2010, 04:52 PM
[No subject] - by Excel - 10-28-2010, 05:44 PM

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