Capital Allowances

Expenditure incurred to alter the building for the purposes of installing the 'machinery' should be regarded as Qualifying Plant Expenditure

• True

• False

Eagle Sdn Bhd purchased a new Mitsubishi Triton Athlete at the cost of RM145,000 to be used in the business.

 

What is the qualifying expenditure to claim Capital Allowance for Eagle Sdn. Bhd.?

• RM50,000

• RM145,000

• RM100,000

• RM150,000

Which of the following is regarded as disposal for Capital Allowances / Industrial Building Allowance purposes?

I. 'Machinery' which is no longer in use for the business but yet to be sold

II. Motor vehicle transferred to a subsidiary

III. Warehouse which was destroyed by fire

IV. Building which was initially used wholly as a factory is now used as a restaurant

• II only

• I and III

• I, II and III

• All of the above

Warehouse used to store goods for export qualify for Capital Allowances under the ITA 1967.

• True

• False

Perisai Sdn Bhd ("PSB") bought a moulding machine from Distance S.A, a resident company in Argentina, for RM138,000. PSB paid an additional amount of RM15,200 for the machine to be installed in Malaysia. However, PSB did not remit any withholding tax to IRB for the purchase of the machine nor the installation cost.

What is the qualifying expenditure of the asset?

• RM153,200

• RM150,000

• RM138,000

• RM0

El Toro Loco Sdn Bhd ("ETL") construct and sell monster trucks. During the year, ETL built a building at a cost of RM250,000. The building was immediately put into use as a site to build engine of the monster trucks.

ETL can claim Industrial Building Allowances ("IBA") on the construction cost.

• True

• False

Which of the following qualify as an Industrial Building?

I. A building which is equipped with 'machinery' in service activities

II. A building that houses equipment for generating power used in manufacturing activities

III. A workshop of a warehousing business rented out to public for storage space

IV. A building used for the storage of raw materials used in manufacturing activities

• I, II and III

• I, III and IV

• II, III and IV

• I and III

What is the initial and annual allowance rate for a software purchased?

• 20%; 40%

• 20%; 20%

• 20%; 10%

• 20%; 8%

Wayang Sdn Bhd purchased a printer at the cost of RM7,850. It was sold a year later at RM3,800.

What is the treatment for the sale of the printer?

• Compute balancing charge or balancing allowances

• Clawback of capital allowances

• No gain / no loss position

The cost incurred for the purchase of an asset is a Qualifying Plant Expenditure if the assets function as a profit making apparatus for the business it carries on.

• True

• False