Taxation

 

1. Street Cred Limited (SCL) operates a business selling streetwear clothing.  

During the year ended 31 March 2022, SCL invoiced customers for $426,000, of which $46,000 had yet to be received from its customers at balance date. On 19 February 2022, an amount of $3,190 was written off as a bad debt in SCL’s accounting system. The amount was for clothing supplied to another business that was invoiced in September 2021.

On 31 October 2021, SCL received a fully imputed net dividend of $8,700 from Cool Caps Limited (CCL), a wholly owned subsidiary of SCL. CCL is a New Zealand tax resident company that is in the business of manufacturing snapback caps.

SCL’s deductible expenditure was $245,000 for the year ended 31 March 2022.

All amounts are GST-exclusive where applicable.

What is SCL’s taxable income for the income year ended 31 March 2022?

A.$177,810.

B.$189,893.

C.$181,000.

D.$186,510.