[shahreel]

Honestly, I am also confused with same question, almost stuck. i dont understand how eanding yield can be lower for GWW when it is 6.7% compared to the 6.25% for competitor, Same way for GWW P/E is 15 while its 16 for the COmpetitors

But answers says other way around,

[shahreel]

Honestly. I am too stuck with this question for long

As of what I understand the chargable value is either M.V at the transfer of asset to employee or the Original value when first asset used by employees minus the taxable value considered Upto the transfer date

(Which ever value is Higher) is taken

So question says the the value when used first by employee was 3600
Later it says it was provided to John on 6 Nov 2020

First calculation is made as follow (on Back of Bpp Answer)

Use 3600*20% – 720
Market value at gift – 1000

or

Original Value – 3600
Less Use:
2020/21 – (720*5/12) -300
2021/22 – 720
2,580

So here greater amount is taken – 2580

Therefore the answer should be 2580 which will be taxable by JOhn starting from in coming year that is 2022/23. (2580*20%) since the transfer is made on 05-April-22

However answer is on other hand is 3300 ( 2580+720) taxable value at transfer + the previous year taxabe figure. which looks bit strange, if i am not mistaken.

How can the whole value (2580) plus the previous year tax value which is already paid is to be taxed in a single year that is at the time the asset is transferred to employee.

Question ask for total taxable benefit for john in respect of computer for tax year 2021/22

Can you please help us in understanding the concept please. Thank you.!!

[shahreel]

Hello Mr. John

How is here Bad debt does not represent any deduction is that because 60%+25%+12% makes a total of 97%, therefore 3% 9s already not included in question please.
Thank you.

[shahreel]

thank you

[shahreel]

Thank you, Mr. John, it makes sense Now.

[shahreel]

Thank you, John, for your answer, it sounds a bit strange to me how the costing is done after the end of actual, if so why even need to expect the normal loss, maybe my thought only reached on budgeting & maybe I have a wrong understanding about the whole concept and chapter’s, Anyways thank you, to answer you this question is from BPP 2022 workbook from the chapter process costing. Thank you again.

[shahreel]

Thank you, Mr. John, Now I got it, The overhead is calculated hourly basis first, Later we allocate these hours to the total number of batches based on its cost base. Thank you Again.

[shahreel]

Thank you very much, John, now it makes perfect sense when you said the interest in holding the inventory, my initial guess was logistic storage price & my question was based on those assumptions. Surely will go through your lecture again, Thank you.

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