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- 6 Marks
Question
The following information is relevant to Mandy Ltd (Ghana), a subsidiary of Menkay Incorporated, a company resident in Japan.
Following Mandy Ltd’s operational challenges, a loan of US$1,500,000 was secured from its parent company in 2019 year of assessment.
Additional information relevant to Mandy Ltd’s operations:
| Description | Amount (GH¢) |
|---|---|
| Interest on loan paid in 2019 | 300,000 |
| Foreign exchange loss | 105,000 |
| Equity: | |
| Share capital | 150,000 |
| Retained earnings | 300,000 |
| Total equity | 450,000 |
Exchange rate: 1US$ = GH¢5.73
Required:
Determine the tax implication of the above transaction.
Answer
- Topic: International taxation
- Series: NOV 2020
- Uploader: Theophilus