MARKER’S COMMENTS
GRADE
Case Study ACCG924 session 2 2014
a.)When Cut and Chop entered into a contract to sell the business premises on 1 May
2014, CGT event A1 occurred.(s104-10)
According to sec100-50, the net capital gain or net capital loss for the income year is calculated as follow:
Current year capital gain=capital proceeds-cost base or indexed cost base
In this case, the capital proceeds is 2.65 million (s116-20). Since the business premise is acquired on 1 June 2009 (after 21 September 1999) indexation method cannot be applied for calculating the cost base (Div 114). The cost base of the premise (s110-25) including purchase price (2.38million), incidental costs (s110-35) (legal fees $13500 and agents fees$45000).
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The income from renting the yacht for weddings, birthdays and promotion events for 60 times are assessable.
The advertising fee for placing advertisement in newspapers and magazines in Sydney is to generate assessable income, thus deductible (S8-1(1)). So as to the payment paid to agent to look after bookings and events.
Since the yacht is both for business and private use. The interest relating to the loan should be spilt into two parts. Mr. Parisi should divided the loan ($85,000) into home loan portion(private usage) and investment loan portion(business usage). The interest relating to the business portion is deductible (s8-1) while the interest relating to the home loan portion is not deductible(s8-1(2)).
Lastly, the expense for the 30 days cruise up the NSW/Queensland coast in the next year is totally private use, thus not deductible.(s8-1(2))
f.) When Mr. and Mrs. Parisi decide to relocate to Korea on 31 August 2014 to reside there indefinitely, CGT event I1 occurs.(s104-160(1)). They are deemed to have disposed of assets that are not taxable Australian property at their market value.
Their shares in the Cut and Chop are taxable Australian property (s855-25) and thus no deemed to dispose until they actually disposed of.
Capital gain or loss that happens to a dwelling that is a taxpayer’s main residence is generally ignored.(Div 118) So, Mr. and Mrs. Parisi can ignore any gain or loss related to
4- The committee and Ms Beckel decided to include a religious studies curriculum in the program. The principal approved of it. However, Ms Wright one of the community members did not. She threatened to show up at the committee meeting with the media. On the day of the meeting, Ms Wright showed up with a placard protesting the use of the bible in public schools.
The fixed cost is assumed that Larry has discovered the other fixed cost incurred. The total investment is $800,000. The worst case scenario assumes that Larry got a total line of credit from the bank in the amount of $400,000 and invested $400,000 from other source. The Notes payable – short term and the long-term debt is (11.8 + 3.7) = 15.5 % from Table F in the handout. The Loan interest and payment per year is ($400,000 * 0.155)= $62,000. The Income data from Table F indicates that there is a 0.4% of all other expenses net out of the total sales which equals to $109,908 (5,700,666 gallons * $4.82 *0.4%) .
As a member of management Clive Jenkins is responsible for boosting employee morale to ensure that company goals are met
Scenario: An elderly woman showed symptoms of near syncope and was admitted via ambulance to a small community hospital. She experienced an inability to move on her own and almost lost consciousness while watching her grandson play basketball. Her symptoms occurred during a visit to her daughter’s home, which is approximately 150 miles from Liza’s home. When Liza was admitted to the hospital, her daughter explained the numerous types and dosages of medications her mother was taking. She also mentioned that Liza had not been taking her Coumadin as directed by her physician for the past week or so. Liza was admitted to the intensive care unit for evaluation. Over the course of hospitalization, Liza’s condition worsened.
The company has an agreement with a bank that allows the company to borrow the exact amount needed at the beginning of each month. The interest rate on these loans is 1% per month and for simplicity we will assume that interest is not compounded. At the end of the quarter, the company will pay the bank all of the accrued interest on the loan and as much of the loan as possible while still retaining at least $50,000 in cash.
3. Should the February 1, 2012, agreement and the May 1, 2012, agreement be accounted for separately or as a single arrangement?
IgG – funtions in neutralizing, opsonation, compliment activation, antibody dependent cell-mediated cytocity, neonatal immunity, and feedback inhibition of B-cells and found in the blood.
Scenario: John is a 4 year-old boy who was admitted for chemotherapy following diagnosis of acute lymphoblastic leukemia (ALL). He had a white blood cell count of 250,000. Clinical presentation included loss of appetite, easily bruised, gum bleeding, and fatigue. Physical examination revealed marked splenomegaly, pale skin color, temperature of 102°F, and upper abdomen tenderness along with nonspecific arthralgia.
Panna wants to buy a new suite of furniture for her flat. The furniture costs £3000 from a furniture store in her local town. The saleswoman suggests that Panna takes out a loan from the store’s finance company to fund the purchase of the furniture. The repayment loan from the finance company would be at a fixed APR of 9 per cent for a repayment term of between one and four years, which Panna can select herself. The loan would take the form of a secured loan.
3. Should the February 1, 2012, agreement and the May 1, 2012, agreement be accounted for separately or as a single arrangement?
Functional magnetic resonance imaging (fMRI) technology would be best reveal the location and extent of damage to Tim’s brain produced by his
Sec 104-15(2) of CGT (Capital Gain Tax) Subdivision 104-B describes the CGT event occurred under Use and enjoyment before title passes. Here, Josh and Ben entered into the contract for the purchase of boat. Ben, being the purchaser wants to have a trail with the boat and promises to buy the boat within the time period of three years or sooner. Fortunately, Ben buys the boat within some months of agreement. Here, Ben has enjoyed the use of the assets before buying it though bound under certain agreement.
Mr. Hugh Tudor (55 yrs) is a well-known person in Milville, where he has been living for 30 years. He is involved in lot of social activities and has a reasonable pension and savings. He is becoming restless in his retirement and shows interest in investing in The Leeds Livery, local British pub in Milville, which could provide him with more challenges. While discussing this matter with his friend, he found out that the pub has great potential to perform well as it once exceeded the profit percentage of the industry. Mr. Tudor is in the process of exploring this opportunity but still has several questions rising in his mind.
In the case “Are Five Heads Better Than One?” a newly formed marketing group, composed of Evan, Conner, Alexis, Derek, and Judy, failed to resurrect the firm’s revenues. First, management failed to select a group of diverse individuals who would be able to contribute unique ideas towards the project. The backgrounds of these five members bared too many similarities for the members to work together efficiently. The article states, “Evan, Conner, Alexis, Derek, and Judy were around the same age, had worked for the company for about the same amount of time, and
Sec 70-30 0f ITAA 1997 advocates that the assets of taxpayer becomes trading stock when he has deemed to have disposed of his assets. Fast Ed has disposed of his asset as he no longer holds the ownership on the very asset. Further Sec70-90(1) considers the assessable income as the market value of the item on the day of the disposal. Here, Fast Ed gave a car costing $ 17,000 with the market value of $19,000 to Slick Sam for the settlement of his debt of $ 18,000. Fast Ed has incurred capital loss of $1,000 ($19,000-$18,000) it is so because in order to settle his debt of $ 18,000 he has given up his car worth $19,000. Thus, $ 1,000 becomes the tax offsets and is deducted from the assessable income.