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8. John Adjusted profits for the year ended 31st December 2022:
£ £ Net profit per accounts
35,950
Deduct
Rent received
9,500
Business use of o
ffi
ce at private home
250
Business use of private telephone: (£450
×
2/5)
180
(9,930)
26,020
Add back:
Wages and salaries
0
Rent and rates: £12,900
×
1/10
1,290
Light and heat: £5,250
×
1/7
750
Depreciation of fixtures and fittings
1,500
Insurance
0
John’s business travel
0
Christmas presents for sta
ff
0
Entertaining UK customers
5,050
Gifts of chocolate to customers
125
Gifts of calendars
0
Trading debt written o
ff
0
Increase in allowance
0
Non trading loan written o
ff
200
Trade debt recovered (Taxable)
0
Depreciation of vehicles
7,500
Private motor expenses: £3,300
×
4,000/12,000 (W1)
1,100
Salesman’s motor car expenses
0
Donation to national charity
50
Donation to local charity
0
Political donation
100
Subscription to chamber of commerce
0
Gift to employee on marriage
0
Squash club subscription
250
Advertising in trade press
0
Cost of renewing 21 year lease
0
Accountancy:
Taxation services re capital gains tax
750
Balance
0
Interest on bank overdraft
0
Van expenses
0
Telephone
0
Repairs to o
ffi
ce photocopier
0
New printer
650
Central heating
2,200
Decorating the o
ffi
ce
0
Goods for own consumption: £450
×
130/100
585
22,100
Adjusted trading profit
48,120
324
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