03 December 2009
1- Status- Firm 2- No of Partners- Two 3- Total Capital on 01.04.08- Rs. 10,00,000 4- Profit bfor intt.on capital & remun. Rs. 1,42,000 upto 31.12.08 5- One partner retire from the firm on 31.12.08 6- Remaining one partner continue the business.
Calculate Interest on Capital, Remuneration allowable U/S 40(b) & taxable profit of the firm on 31.12.08
03 December 2009
1) Interest on capital @ 12% for 9 months= Rs.90,000/- 2) Remuneration:- net profit 1,42,000/- Less: interest 90,000/- --------- Book profit 32,000/- ========= 3) Remuneration 32,000/- 4) Taxable income NIL
PROVIDED THE INSTRUMENT OF PARTNERSHIP CONTAINS PROVISIONS TO THIS EFFECT. IF NOT THE CALCULATION MAY BE IGNORED.
03 December 2009
Yes there is a mistake.Book profit is corrected as Rs.52,000/- Remuneration is Rs.50,000/- Taxable income Rs.2000/- Mistake is regretted.
CAclubindia
