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Question 5b
Retro Ltd’s summarised statement of profit or loss for the year ended 31 March 2015 is as follows:
| Note | £ | £ | |
|---|---|---|---|
| Gross profit | 127,100 | ||
| Operating expenses | |||
| Depreciation | 27,240 | ||
| Gifts and donations | 1 | 2,300 | |
| Impairment loss | 2 | 1,600 | |
| Leasing costs | 3 | 4,400 | |
| Other expenses | 4 | 205,160 | |
| (240,700) | |||
| Finance costs | |||
| Interest payable | 5 | (6,400) | |
| Loss before taxation | (120,000) |
Previous results
Retro Ltd commenced trading on 1 September 2012. The company’s results for its two previous periods of trading are as follows:
| Year ended | Period ended | |
|---|---|---|
| 31 August 2013 | 31 March 2014 | |
| £ | £ | |
| Tax adjusted trading profit | 56,600 | 47,900 |
| Bank interest receivable | 1,300 | 0 |
| Qualifying charitable donations paid | (540) | (330) |
Future results
Retro Ltd is expected to return to profitability in the year ended 31 March 2016 and to continue to be profitable in subsequent years.
Required:
(b) Assuming that Retro Ltd claims relief for its trading loss as early as possible, calculate the company’s taxable total profits for the year ended 31 August 2013 and for the seven-month period ended 31 March 2014. (4 marks)