The following is an incomplete statement of the total profit of the Alfa production company for the year ended December 31, 2019: (cu) Revenue from sales of 1,500,000
Cost of sales (780,000)
Gross profit 720,000
General and administrative expenses (250,000)
Trading expenses (160,000)
Research and development expenses (180,000)
Financial income 5,000
Profit before tax
Additional information:
* General and administrative expenses include expenses not allowed for deduction for tax purposes in the amount of 15,000 y. e
• * The initial cost of fixed assets is 1,000,000 y. e. The amount of accumulated depreciation as of 31.12.2018: for accounting - 500,000 y. e., for tax accounting-650000 y. e.
* Depreciation expenses (deductions) in 2019: for accounting - 100,000 units, and for tax accounting -60,000 units. Depreciation expenses were correctly accounted for as part of the cost of products sold, general and administrative expenses and trading expenses.
• As part of the research and development costs, the amount of 80,000 USD relates to the development stage. This amount at the end of 2019 met the criteria for recognition as an intangible asset. For taxation purposes, the entire amount of research and development expenses is deductible in 2019.
* Finance income consists of the amount of revaluation (unrealized gain) on securities classified as carried at fair value through other comprehensive income (available for sale). The company acquired these securities in 2019 for $25,000. The amount of revaluation is taxed only when securities are sold.
• The amount of accumulated tax loss at the end of 2018, allowed for deductions in subsequent years, amounted to 95,000 CU. In 2019, the company can use this amount to reduce taxable profit when calculating the current tax liability.
* The income tax rate is 20%.
Required: To determine the correct amount of pre-tax profit for 2019.