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CIMA Exam CIMAPRA19-F01-1 Topic 5 Question 106 Discussion

Actual exam question for CIMA's CIMAPRA19-F01-1 exam
Question #: 106
Topic #: 5
[All CIMAPRA19-F01-1 Questions]

Entity RH has an recognised a taxable profit of $1.Smillion for 20X1'. In Entity RH's resident country. Country M, depreciation charges and entertaining expenses are disallowed expenses. Below is some information on Entitry RH's outgoings for the period:

Depreciation charged on PPE: $450,000

Political donations: $155,000

Staff parties: $3,200

Cost of updating assets: $10,000

Other expenses: $83,500

In Country M, there is a standard corporation tax of 12% charged on all corporation profits. What is Entity RH's total tax liability for this period?

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Suggested Answer: B

Contribute your Thoughts:

Maybelle
5 days ago
I agree with Cecily, because the total tax liability should be calculated based on the taxable profit and the standard corporation tax rate.
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Cecily
6 days ago
I think the answer is A) $234,384.
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