SOLUTION 1

FYE = 31/12

Machine RM
YA2020
Cost 85,000
Installa�on 7,000
QE 92,000
-) IA (20% x 92,000) (18,400) 
-) AA (14% x 92,000)  (12,880)
RE 60,720

YA2021
-) AA (14% x 92,000) (12,880) 
RE 47,840

YA2022
Disposal 55,000
BC 7,160

Car : max QE = 100k (cost < 150k) Acc. QE

YA2021 RM RM
Deposit 25,000
Instalments (115,000 – 25,000) / 24 = 3,750 x 33,750
9
58,750 58,750
-) IA (20% x 58,750)  (11,750)
-) AA (20% x 58,750)  (11,750)
RE 35,250

YA2022
Instalments (115,000 – 25,000)/ 24 = 3,750 x 12 = 41,250 41,250
45,000 restricted to
Revised RE / Acc. QE 76,500 100,000
-) IA (20% x 41,250)  (8,250)
-) AA (20% x 100,000)  (20,000)
RE 48,250

Factory – renova�on RM
YA2020
Renova�on cost 350,000
Demolishing office building (non-IB) 15,000
QBE 365,000
-) IA (10% x 365,000)  (36,500)
-) AA (3% x 365,000)  (10,950)
RE 317,550

YA2021
-) AA (3% x 365,000) (10,950) 
RE 306,600

YA2022
-) AA (3% x 365,000) (10,950) 
RE 295,650

Dining table (10 units) RM

YA2022
QE (10 x 1,950) 19,500
-) CA (100% x 19,500) (19,500) 
RE NIL

Dining table (1 unit)

YA2022
QE 1,950
-) IA (20% x 1,950) (390) 
-) AA (10% x 1,950) (195) 
RE 1,365
(38  x 0.5 mark = 19 marks)
SOLUTION 2

FYE: 31/12

Factory RM
YA2020
Land Nil
Legal fees – land Nil
Legal fees – construc�on (20,000 – 7,000) 13,000
Stamp duty – land Nil
Demolishing old factory (IB) Nil
Architect fees 22,000
Approval plan – local authority 5,000
Construc�on costs 340,000
QBE 380,000
Apply 10% rule:
NIB (office + showroom) = (6% + 5%) = 11%
IB (factory) = 89%

Since the non-industrial building exceeds 10% of the total floor space, therefore, the QBE needs to
be appor�oned based on industrial building space. 
QBE (380,000 x 89%) 338,200
-) IA (10% x 338,200)  (33,820)
-) AA (3% x 338,200)  (10,146)
RE 294,234

YA2021
-) AA (3% x 338,200) (10,146) 
RE 284,088

YA2022
-) AA (3% x 338,200) (10,146) 
RE 273,942

BMW X1 = max QE = 50,000 (cost > 150k) Acc. QE

YA2020 RM RM
Deposit = 80,000 restricted to 50,000
Instalments (220,000 – 80,000)/56 = 2,500 x 1 = Nil
2,500 restricted to
QE 50,000 50,000
-) IA (20% x 50,000)  (10,000)
-) AA (20% x 50,000)  (10,000)
RE 30,000

YA2021
-) AA (20% x 50,000) (10,000) 
RE 20,000

YA2022
-) AA (20% x 50,000) (10,000) 
 RE 10,000

Note:

No need to compute instalments & IA for YA2021 since the restricted QE had been achieved in YA2020.

Shredder Machine RM
YA2021
QE 36,000
-) IA (20% x 36,000)  (7,200)
-) AA (14% x 36,000)  (5,040)
RE 23,760

YA2020
Disposal 22,000
BA 1,760
Since the disposal took place within 2 years from the date of acquisi�on, all capital allowances
previously claimed will be clawed back and treated as Balancing Charge. BC = RM12,240. 

Dining table (2A = use for private purpose previously) RM

YA2022
QE = MV 3,550
-) IA Nil
-) AA (10% x 3,550)  (355)
RE 3,195
(34 x 0.5 mark = 17 marks)
SOLUTION 3

FYE : 31/12

Factory RM
YA2020
Apply 10% rule:
NIB (office) = 1/9 = 11.11%
IB (factory) = 8/9 = 88.89%
Since the non-industrial building space exceeds 10% of the total space. Therefore, QBE needs to be
appor�oned according to industrial building space. 
QBE (1,100,000 x 88.89%) 977,790
-) IA (10% x 977,790)  (97,779)
-) AA (3% x 977,790)  (29,334)
RE 850,677

YA2021
-) AA (3% x 977,790) (29,334) 
RE 821,343

Motor vehicle (Max QE = 100k; cost < 150k) Acc. QE

YA2020 RM RM
Deposit = trade in value old car 36,000
Instalments (147,600 – 36,000)/36 = 3,100 x 10 31,000
QE 67,000 67,000
-) IA (20% x 67,000)  (13,400)
-) AA (20% x 67,000)  (13,400)
RE 40,200

YA2021
Instalments (147,600 – 36,000)/36 = 3,100 x 12 = 33,000 33,000
37,200 restricted to
Revised RE / Acc. QE 73,200 100,000
-) IA (20% x 33,000)  (6,600)
-) AA (20% x 100,000)  (20,000)
RE 46,600

Rented building does not qualify for IBA since the business did not incur the qualifying building
expenditure. 

Renova�on (rented building for IB) RM

YA2021
QE 55,000
-) IA Nil
-) AA (10% x 55,000) (5,500) 
RE 49,500
 Computer RM
YA2021
QE 3,200
-) IA (20% x 3,200) (640) 
-) AA (disposal in the year of acquisi�on) Nil
RE 2,560
Disposal Nil
BA 2,560

Note:

Since the disposal with commercial jus�fica�on, no clawed back of capital allowance will be done.

(26  x 0.5 mark = 13 marks)

SOLUTION 4

FYE = 31/10

Factory RM
YA2020
Cost of land Nil
Architect fee 21,000
Approval cost – local authority 5,000
Demolishing cost – warehouse (IB) Nil
Construc�on costs 982,000
QBE 1,008,000
Apply 10% rule:
NIB (office + showroom) = 9% + 6% = 15%
IB (factory + surau) = 85%
Since the non-industrial building space exceeds 10% of the total space, therefore, QBE needs to be
appor�oned according to industrial building space. 
QBE (1,008,000 x 85%) 856,800
-) IA (10% x 856,800)  (85,680)
-) AA (3% x 856,800)  (25,704)
RE 745,416

YA2021
-) AA (3% x 856,800) (25,704) 
RE 719,712

Moulding machine RM
YA2020
Cost 400,000
Installa�on 20,000
COPS 1,280,000
AC 1,700,000
Apply 75% rule:
1,280,000 / 1,700,000 X 100% =75.29%
Since COPS exceed 75% of the aggregate cost, therefore the aggregate cost is qualify as QBE. 
QBE 1,700,000
-) IA(10% x 1,700,000)  (170,000)
-) AA (3% x 1,700,000)  (51,000)
RE 1,479,000

YA2021
-) AA (3% x 1,700,000) (51,000) 
RE 1,428,000
 Delivery truck (commercial vehicle) Acc. QE
YA2021 RM RM
Deposit 30,000
-) instalments (282,000 – 30,000)/ 72 = 3,500 x 10 35,000
QE 65,000 65,000
-) IA (20% x 65,000)  (13,000)
-) AA (disposal in the same year of acquisi�on) Nil
RE 39,000

Disposal (250,000 x 65,000 / 282,000) 57,624

BC 18,624

Note:

Since the disposal with commercial jus�fica�on, no clawed back of capital allowance will be done.

Furniture (Table, office chair, bench chair (20 units))

YA2021
QE (12,000 + 3,600 + (20 x 220 = 4,400)) 20,000
-) CA (100% x 20,000) (20,000) 
RE Nil

Furniture – bench chair (10 units)

YA2021
QE (10 x 220) 2,200
-) IA (20% x 2,200) (440) 
-) AA (10% x 2,200) (220) 
RE 1,540
(30  x 0.5 mark = 15 marks)
SOLUTION 5

FYE 13/12

Factory RM
YA2020
Cost of land Nil
Architect fee 135,500
Internal road & drainage system 164,500
Construc�on cost 1,275,000
Wiring & plumbing 145,000
Legal fees – land Nil
QBE 1,720,000
Apply 10% rule:
NIB (office & showroom) = 15% + 10% = 25%
IB (factory) = 75%
Since the non-industrial building por�on exceeds 10% of the total space, therefore, QBE needs to
be appor�oned according to industrial building space. 
QBE (1,720,000 x 75%) 1,290,000
-) IA (10% x 1,290,000)  (129,000)
-) AA (3% x 1,290,000)  (38,700)
RE 1,122,300

YA2021
-) AA (3% x 1,290,000) (38,700) 
RE 1,083,600

New Honda (max QE = 100,000, cost <150K) Acc. QE

YA2020 RM RM
Deposit 19,900
Instalments (139,900 – 19,900)/24 = 5,000 x 5 25,000
QE 44,900 44,900
-) IA (20% x 44,900)  (8,980)
-) AA (20% x 44,900)  (8,980)
RE 26,940

YA2021
Instalments (139,900 – 19,900)/24 = 5,000 x 12 = 60,000 55,100 55,100
restricted to
Revised RE / acc. QE 82,040 100,000
-) IA (20% x 55,100)  (11,020)
-) AA (20% x 100,000)  (20,000)
RE 51,020
Cu�ng machine (2C = used for business outside Msia previously) RM
YA2020
QE (MV or NBV WIL) = MV 67,000
-) IA Nil
-) AA (14% x 67,000) (9,380) 
RE 57,620

YA2021
-) AA (14% x 67,000) (9,380) 
RE 48,240
(24  x 0.5 mark = 12 marks)