Assessment of Companies
Assessment of Companies
Assessment of Companies
ASSESSMENT OF COMPANIES
1. The book profit of the company is Rs 300000. Compute its tax liability keeping in view the
provisions of MAT U/S 115JB.
2. The total income under the IT act of 1961 is Rs 450000. The book profit of the company in the
PY 2016-17 in view with U/s 115JB of the IT Act is Rs 1500000. Is the company liable to MAT?
3. The total income of the company is Rs 5780000outoff which long term capital gain is Rs
33000 and income from business is Rs 545000. The book profit of the company is Rs 1000000.
Compute its tax liability.
4. ABC Co Ltd is a domestic company. The following incomes are furnished by the company.
5. Nirmala Roy traders Ltd closes its accounts on 31/3 Every Year for the year 2016-17. The
following details are given.
1. The above profit and Loss A/c has been prepared as per Companies Act 19566
2. Brought forward loss and depreciation
Particulars As per books of accounts As per IT
Brought forward losses 200000 250000
Unabsorbed depreciation 100000 200000
Calculate taxable total income and tax liability as per normal provisions of IT Act. Book Profit
and tax liability as per MAT provisions and Ultimate Tax liability
7. The following is the Profit and Loss A/c of LM Ltd an Indian company for the year ending
31/3/17. Calculate the final tax liability
8. My Ambition Ltd is engaged in the business of developing and exporting computer software.
The following is the profit and loss A/c for the ended 31/3/2018
9. An Indian Co carries on business in Motor Transportation. Its profit and Loss A/c for the PY
2016-17 shows a Net Profit of Rs 561300. Find out total income ad tax liability of the company
after taking into consideration the following particulars.
Rs 450000 as depreciation
Rs 56250 as bad debts reserve
Rs 15000 spent to obtain new license and company was able to get it.
The engine of very old bus was replaced by a new one by spending Rs 75000
The Profit and Loss account was credited with the following Incomes
10. KML Ltd is a domestic co in which public are substantially interested. It show the net profit
of Rs 7400000 for the PY 2016-17 after providing for taxation Rs 350000 but before providing
for depreciation the following are the other particulars.
Depreciation Rs 470000
Brought forward loss Rs 340000
Net profit included the following
Dividend from DBM Ltd, Kolkata Rs 60000
STCG on sale of Units Rs 87000
LTCG on sale of jewelry Rs 68000
The following items have been debited to Profit and loss A/c
Expenses on maintenance Rs 32000
Penalty of excise loss Rs 12000
Donation to accrued institution to be utilized for promoting family planning Rs 21000
The amount of dividend distributed by the company during 2016-17, Rs 1280000
Compute the total income and tax payable by the company under normal provisions for
the AY 2017-18
11. The following is the P&L A/c of Dhamaka Ltd for the year ended 31/3/17
12. BPG Ltd is a domestic company which shows a net profit of Rs 1315000 for the ending
31/3/17. This includes the following debit profit and loss A/c.
1. 350000 has been distributed as dividend among the shareholders during the PY 2016-17
2. Interest amounting Rs10000 paid on loan taken for the payment of company liability for
excise duty.
3. Interest amounting Rs 34000 paid on the loan taken to pay income tax.
4. Company director’s wife accompanied a trip to England a sum of Rs 24000 was spent by
the company towards her foreign trip expenses which are debited to P/L A/c
5. Company incurred Rs 145000 on maintenance of holiday home
6. Company incurred expenditure of Rs 90000 as follows:
Advertisement in newspaper amount paid in cash Rs 22000
Advertisement in sovenier of political parties Rs 20000
7. Rs 18000 paid as legal expenses in respect of proceeding
8. Penalty of Rs 36000 for importing
9. The total income included
LTCG on the sale of Investment Rs 120000
STCG Rs 105000
10. The company was maintaining a stud for race horses and there was stake money Rs
200000 and the expenditure on maintenance of horses amounting Rs 370000. These
amount have been included in P/L A/c
11. Depreciation for the year amounted to Rs 125600 which has not been debited.