# Business Tax FA2016 Assessment question

LouboutinLou1
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**21**
Hi,

This question is from the AAT practice exam 2016 - Task 3

I managed to work out the salaries for Poppy, Paul & Pino but can't seem to be able to get the profit shares correct.

Can anyone help please?

Thanks

This question is from the AAT practice exam 2016 - Task 3

I managed to work out the salaries for Poppy, Paul & Pino but can't seem to be able to get the profit shares correct.

Can anyone help please?

Thanks

## Comments

2119From 1st April

Salary for Poopy > 5360

Salary for Paul > 3750

Total salaries paid = 9110

Profit year ended 31 March > 68600 / 12 = 5717 profit per month

Profit for the first period > 5717 x 3 = 17150

You then need to deduct the salaries already paid from the profit to share in the first period

17151-9110=8041

Then share the profit left as indicated:

Poopy 8041x40%= 3216

Paul 8041x60%= 4824

Same for the second period.

Total salaries paid > 43890

Profit for the second period > 68600/12x9 = 51445

Profit left for sharing > 51445 - 43890 = 7560

Poopy 7560 x 20% = 1512

Paul 7560 x 40% = 3024

Pino 7560 x 40% = 3024

If you add up all the salaries & profit paid it should give you the total profit for the year

5360 + 3750 + 3216 + 4824 + 43890 + 1512 + 3024 + 3024 = 68600

21I seem to be struggling with BTax FA2015 also (Task 3)

I have the tax years and basis periods correct but the profit incorrect. Can't find where I'm going wrong with this one??

19You need to apportion each profit given accordingly to each period.

P/e 30 June 2014 > 50750

P/e 30 June 2015 > 106800

P/e 30 June 2016 > 77400

First year > 50750/7X4 = 29000

7 > these are the months which the first profit belongs to (1 Dec - 30 June)

4 > since the first year is only until March 2014, only 4 months will be considered.

Second year > 50750 + (106800/12X5) = 95250

Third year > 106800

In the second year is where the profit is being overlapped > 29000 from 1 Dec to 6 April which were already taken into consideration in the 1st year.

21