Retirement – NBC Institute

TAX – May 2019 – L2 – Q1a- Taxation of Partnerships and Sole Proprietorships

Compute adjusted income and profit allocation for a civil engineering partnership.

Question

a) Obi Consults is a civil engineering consulting firm of many years. The founding partners are Bibi, Kose, and Fowora. The financial year-end of the firm is December 31 each year. The following information was extracted from the partnership’s financial statements/records for the year ended December 31, 2018:

Details	Amount (N)
(i) Net profit for the year	21,575,000
(ii) Provision for depreciation	13,250,000
(iii) Fine paid for traffic offence	25,000
(iv) Donations to “politicians in business”	150,000
(v) Donation to National Library Board	165,000
(vi) Profit from sale of excavator	1,600,000
(vii) Capital allowances	6,575,000
(viii) Balancing allowance	677,000
(ix) Balancing charge	1,315,000

Additional information:

Profit sharing ratio: Bibi – 1/2, Kose – 1/4, Fowora – 1/4
Bibi and Fowora are entitled to 5% interest per annum on a loan of N10,500,000 each. Fowora’s loan was refunded fully on his retirement.
Salaries paid: Bibi – N10,800,000, Kose – N8,250,000, Fowora – N8,250,000
Fowora retired on June 30, 2018, and Jaycee was admitted as a new partner on July 1, 2018, with an annual salary of N8,250,000. Jaycee introduced a loan of N7,000,000 on July 1, 2018, entitled to a 5% interest per annum.
The profit-sharing ratios after Jaycee’s admission: Bibi – 1/2, Kose – 7/20, Jaycee – 3/20

You are required to:
(i) Compute the adjusted/assessable income of the partnership. (5 Marks)
(ii) Determine the share of profits among the partners. (3 Marks)
(iii) Show relevant workings for prorated salaries and interest on loans, assuming simple interest. (2 Marks)
(iv) Compute the assessable income of each partner. (10 Marks)

Answer

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Tags: Adjusted Income, Assessable Income, Capital Allowance, Partnership, Proration, Retirement, Tax computation
Level: Level 2

Topic: Taxation of Partnerships and Sole Proprietorships
Series: MAY 2019

PT – April 2022 – L2 – Q2d – Pension Entitlement Calculation

Compute the monthly pension entitlement of Mrs. Akoto based on her salary and months of contribution.

Question

d) Mrs. Akoto has been engaged by Madane Ltd as the Marketing Manager for 30 years on an annual salary of GH¢20,000.
The following information relates to Mrs. Akoto:
i) Throughout her working life, she earned her best salaries from Madane Ltd.
ii) She has 408 months’ contribution to her credit.
iii) She retired on 31 March 2020 at the age of 60.

Required:
Compute her monthly pension entitlement.
(5 marks)

Answer

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Tags: Pension calculation, Pension entitlement, Pension Right, Retirement

Topic: Income Tax Liabilities, Pension Calculation
Series: APR 2022

PT – July 2023 – L2 – Q2d – Income Tax Liabilities

Explanation of the basis for calculating pension benefits under the National Pensions Act, 2008 (Act 766).

Question

Explain the basis for calculating pension benefits under the National Pensions Act, 2008 (Act 766). (5 marks)

Answer

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Tags: Defined Benefit Scheme, National Pensions Act, Pension benefits, Pension Right, Retirement
Level: Level 2

Topic: Income Tax Liabilities
Series: JULY 2023

PT – Dec 2023 – L2 – Q2c – Income Tax Liabilities

Compute pension benefit and monthly pension pay based on provided salary and pension contributions.

Question

Mr. John Romeski worked for Aligidon Company Ltd for 25 years and retired at the age of 60. In the last 3 years of his working life, he earned annual salary as follows:

Year	Annual Salary (GH¢)
58th	93,000
59th	96,000
60th	99,000

He has 300 months’ contribution to his credit.

Required:

Assuming he retired under the National Pension Act, 2008 (Act 766), compute his pension benefit and his monthly pension pay. (5 marks)

Answer

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Tags: Ghana tax laws, National Pension Act, Pension benefits, Pension Computation, Retirement
Level: Level 2

Topic: Income Tax Liabilities
Series: DEC 2023

BCL – Nov 2016 – L1 – Q4a – Alternative Forms and Constitutions of Business Organisations

Determine whether partners remained after notice of retirement under the Incorporated Private Partnership Act, 1962 (Act 152).

Question

By a letter dated 18th February 2014, addressed to the Manager of their partnership firm, Kofi Nti informed the Management of his and Mrs. Obeng’s immediate retirement as partners. The Manager replied that their application was under consideration. However, by another letter dated 12th January 2015, Mr. Kofi Nti and Mrs. Obeng withdrew their letter dated 18th February 2014. The conduct of the remaining partners, however, showed that they considered the letter of 18th February 2014 to be of no effect, and continued the partnership accordingly. A dispute later arose and Jeff, one of the partners, obtained an order of the High Court directing Mr. Kofi Nti and Mrs. Obeng to submit themselves to arbitration in accordance with the partnership agreement. The arbitrator submitted to the court that by their letter dated 18th February 2014, Mr. Kofi Nti and Mrs. Obeng ceased as from that date to be partners as the said letter could not be recalled.

Required:
Explain whether by the provisions of the Incorporated Private Partnership Act, 1962 (Act 152), Mr. Kofi Nti and Mrs. Obeng remain partners in the firm after their letters of 18th February 2014 and 12th January 2015.

Answer

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Tags: Ghana, Legal obligations, Partnership, Retirement
Level: Level 1

Topic: Alternative forms and constitutions of business organisations
Series: NOV 2016

TAX – May 2019 – L2 – Q1a- Taxation of Partnerships and Sole Proprietorships

Compute adjusted income and profit allocation for a civil engineering partnership.

Question

Details	Amount (N)
(i) Net profit for the year	21,575,000
(ii) Provision for depreciation	13,250,000
(iii) Fine paid for traffic offence	25,000
(iv) Donations to “politicians in business”	150,000
(v) Donation to National Library Board	165,000
(vi) Profit from sale of excavator	1,600,000
(vii) Capital allowances	6,575,000
(viii) Balancing allowance	677,000
(ix) Balancing charge	1,315,000

Additional information:

Profit sharing ratio: Bibi – 1/2, Kose – 1/4, Fowora – 1/4
Bibi and Fowora are entitled to 5% interest per annum on a loan of N10,500,000 each. Fowora’s loan was refunded fully on his retirement.
Salaries paid: Bibi – N10,800,000, Kose – N8,250,000, Fowora – N8,250,000
Fowora retired on June 30, 2018, and Jaycee was admitted as a new partner on July 1, 2018, with an annual salary of N8,250,000. Jaycee introduced a loan of N7,000,000 on July 1, 2018, entitled to a 5% interest per annum.
The profit-sharing ratios after Jaycee’s admission: Bibi – 1/2, Kose – 7/20, Jaycee – 3/20

Answer

Find Related Questions by Tags, levels, etc.

Tags: Adjusted Income, Assessable Income, Capital Allowance, Partnership, Proration, Retirement, Tax computation
Level: Level 2

Topic: Taxation of Partnerships and Sole Proprietorships
Series: MAY 2019

PT – April 2022 – L2 – Q2d – Pension Entitlement Calculation

Compute the monthly pension entitlement of Mrs. Akoto based on her salary and months of contribution.

Question

Required:
Compute her monthly pension entitlement.
(5 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Pension calculation, Pension entitlement, Pension Right, Retirement

Topic: Income Tax Liabilities, Pension Calculation
Series: APR 2022

PT – July 2023 – L2 – Q2d – Income Tax Liabilities

Explanation of the basis for calculating pension benefits under the National Pensions Act, 2008 (Act 766).

Question

Explain the basis for calculating pension benefits under the National Pensions Act, 2008 (Act 766). (5 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Defined Benefit Scheme, National Pensions Act, Pension benefits, Pension Right, Retirement
Level: Level 2

Topic: Income Tax Liabilities
Series: JULY 2023

PT – Dec 2023 – L2 – Q2c – Income Tax Liabilities

Compute pension benefit and monthly pension pay based on provided salary and pension contributions.

Question

Mr. John Romeski worked for Aligidon Company Ltd for 25 years and retired at the age of 60. In the last 3 years of his working life, he earned annual salary as follows:

Year	Annual Salary (GH¢)
58th	93,000
59th	96,000
60th	99,000

He has 300 months’ contribution to his credit.

Required:

Assuming he retired under the National Pension Act, 2008 (Act 766), compute his pension benefit and his monthly pension pay. (5 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Ghana tax laws, National Pension Act, Pension benefits, Pension Computation, Retirement
Level: Level 2

Topic: Income Tax Liabilities
Series: DEC 2023

BCL – Nov 2016 – L1 – Q4a – Alternative Forms and Constitutions of Business Organisations

Determine whether partners remained after notice of retirement under the Incorporated Private Partnership Act, 1962 (Act 152).

Question

Answer

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Tags: Ghana, Legal obligations, Partnership, Retirement
Level: Level 1

Topic: Alternative forms and constitutions of business organisations
Series: NOV 2016

Question Tag: Retirement

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TAX – May 2019 – L2 – Q1a- Taxation of Partnerships and Sole Proprietorships

Compute adjusted income and profit allocation for a civil engineering partnership.

PT – April 2022 – L2 – Q2d – Pension Entitlement Calculation

Compute the monthly pension entitlement of Mrs. Akoto based on her salary and months of contribution.

PT – July 2023 – L2 – Q2d – Income Tax Liabilities

Explanation of the basis for calculating pension benefits under the National Pensions Act, 2008 (Act 766).

PT – Dec 2023 – L2 – Q2c – Income Tax Liabilities

Compute pension benefit and monthly pension pay based on provided salary and pension contributions.

BCL – Nov 2016 – L1 – Q4a – Alternative Forms and Constitutions of Business Organisations

Determine whether partners remained after notice of retirement under the Incorporated Private Partnership Act, 1962 (Act 152).

TAX – May 2019 – L2 – Q1a- Taxation of Partnerships and Sole Proprietorships

Compute adjusted income and profit allocation for a civil engineering partnership.

PT – April 2022 – L2 – Q2d – Pension Entitlement Calculation

Compute the monthly pension entitlement of Mrs. Akoto based on her salary and months of contribution.

PT – July 2023 – L2 – Q2d – Income Tax Liabilities

Explanation of the basis for calculating pension benefits under the National Pensions Act, 2008 (Act 766).

PT – Dec 2023 – L2 – Q2c – Income Tax Liabilities

Compute pension benefit and monthly pension pay based on provided salary and pension contributions.

BCL – Nov 2016 – L1 – Q4a – Alternative Forms and Constitutions of Business Organisations

Determine whether partners remained after notice of retirement under the Incorporated Private Partnership Act, 1962 (Act 152).

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TAX – May 2019 – L2 – Q1a- Taxation of Partnerships and Sole Proprietorships

Compute adjusted income and profit allocation for a civil engineering partnership.

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PT – April 2022 – L2 – Q2d – Pension Entitlement Calculation

Compute the monthly pension entitlement of Mrs. Akoto based on her salary and months of contribution.

You're reporting an error for "PT – April 2022 – L2 – Q2d – Pension Entitlement Calculation"

PT – July 2023 – L2 – Q2d – Income Tax Liabilities

Explanation of the basis for calculating pension benefits under the National Pensions Act, 2008 (Act 766).

You're reporting an error for "PT – July 2023 – L2 – Q2d – Income Tax Liabilities"

PT – Dec 2023 – L2 – Q2c – Income Tax Liabilities

Compute pension benefit and monthly pension pay based on provided salary and pension contributions.

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BCL – Nov 2016 – L1 – Q4a – Alternative Forms and Constitutions of Business Organisations

Determine whether partners remained after notice of retirement under the Incorporated Private Partnership Act, 1962 (Act 152).

You're reporting an error for "BCL – Nov 2016 – L1 – Q4a – Alternative Forms and Constitutions of Business Organisations"

TAX – May 2019 – L2 – Q1a- Taxation of Partnerships and Sole Proprietorships

Compute adjusted income and profit allocation for a civil engineering partnership.

You're reporting an error for "TAX – May 2019 – L2 – Q1a- Taxation of Partnerships and Sole Proprietorships"

PT – April 2022 – L2 – Q2d – Pension Entitlement Calculation

Compute the monthly pension entitlement of Mrs. Akoto based on her salary and months of contribution.

You're reporting an error for "PT – April 2022 – L2 – Q2d – Pension Entitlement Calculation"

PT – July 2023 – L2 – Q2d – Income Tax Liabilities

Explanation of the basis for calculating pension benefits under the National Pensions Act, 2008 (Act 766).

You're reporting an error for "PT – July 2023 – L2 – Q2d – Income Tax Liabilities"

PT – Dec 2023 – L2 – Q2c – Income Tax Liabilities

Compute pension benefit and monthly pension pay based on provided salary and pension contributions.

You're reporting an error for "PT – Dec 2023 – L2 – Q2c – Income Tax Liabilities"

BCL – Nov 2016 – L1 – Q4a – Alternative Forms and Constitutions of Business Organisations

Determine whether partners remained after notice of retirement under the Incorporated Private Partnership Act, 1962 (Act 152).

You're reporting an error for "BCL – Nov 2016 – L1 – Q4a – Alternative Forms and Constitutions of Business Organisations"

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