**QUESTION 2**

Zhola Pvt Ltd is a company operating as a manufacturer in Zimbabwe. Below is information regarding its business activities for the assessment year ending 31 December 2022:

**Income Statement:**

- **Sales:** $3,300,000
- **Cost of Sales:** $(900,000)
- **Gross Profit:** $2,400,000

**Less Expenses:**

- Bad and Doubtful Debts: $120,000
- Research and Experiments: $190,000
- Motor Vehicle Repairs and Maintenance: $150,000
- Depreciation: $110,000
- Travelling Expenses: $60,000
- Import Duty on New Machinery: $20,000
- Audit Fees: $12,000
- Income Tax Advice: $16,000
- ZESA Connection Fees: $28,000
- Interest on Loan to Construct Factory: $52,000
- Donations: $300,000
- General Expenses: $520,000
- Proposed Dividends: $90,000

**Total Expenses:** $(1,668,000)

**Operating Profit:** $732,000

**Additional Information:**

- **Bad and Doubtful Debts:**
- Bad Debts Proven Irrecoverable: $90,000
- Provision for Doubtful Debts (10% of Debtors): $30,000

- **Research and Experiments:**
- 50% related to equipment acquired at the beginning of the year.

- **Travelling Expenses:**
- Business Trip: $40,000
- Private Expenses for the Managing Director's Wife: $20,000

- **Donations Include:**
- Manufacturers Association: $60,000
- Charitable: $40,000
- University of Zimbabwe: $200,000

- **General Expenses:**
- Telephone Expenses: $80,000
- Fire Insurance: $20,000
- Fuel and Electricity: $420,000

**Company Assets and Their Income Tax Values (ITVs) as of 2022:**

- **Cost** | **ITV**
- Motor Vehicles (Trucks): $200,000 | $100,000
- Furniture & Fittings: $100,000 | $40,000
- Tractors: $120,000 | $60,000
- Plant & Machinery: $240,000 | $130,000
- Factory Building: $1,200,000 | $900,000

The company claimed SIA on trucks and tractors during the year ended 31 December 2021. No SIA was claimed on other assets in previous years.

**Additions to Assets During the Year:**

- Machinery: $200,000
- 2 Tonne Truck (Second Hand): $20,000
- New Office Furniture: $40,000
- Extension to Factory Building: $12,000

**Required:**

A. Compute the company's minimum taxable income or maximum assessed loss for the year ended 31 December 2022, including any tax payable if applicable. (25 Marks)