Accounting Assignment

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Accounting Assignment

Part one -Capital gain tax

It is extremely necessary to think about the consequences of capital gain tax of the sail of Anita's collection. Meanwhile according to the section 104-10(1) of ITAA 1997 there are disposal of CGT assets and disposal of CGT event (Cypser, 2012). in order to calculate the consequences of capital gain tax it is imperative to identify the nature of each assets as CGT assets, collectables or assets of personal use, however in this case all the assets of Anita are collectables as it is clearly explained in the section 108-10(2) of 1997 act.

Antique ceramic bowl

According to the 1997 act, Anita purchased the bowl for mush more than $500, which means that any gain obtained by Anita by selling of the assets is assessable. However, since this asset was purchased on 20th September 1985 and thus the $8000 is not included in the CGT:s 104-10(5).

Sculpture

According to the given information Anita purchased the sculpture was purchased during December 1993, and immediately sell of the product on January next year. According to ITAA 1997, Anita purchased this sculpture after the period of 1985, and thus any gained obtained from the calculation of CGT would be considered as a taxable capital gain(Gleason & Mills,2002). In order to determine the capital gain Anita can use either indexation method, or can use the method of 50% CGT discount, however, the second method is only applicable if Anita has incurred certain loss and current no loss is being reported thus she would use the indexation method. The capital gain for Anita using the indexation method is calculated as follows.

1993 indexation figure = 110.0

1999 indexation figure is = 123.4

Indexation factor = 123.4/110.4

Indexation factor = 1.122 and thus the indexed cost is 5500*1.122 =

This gives an indexation factor of 1.122 (rounded to 3 decimal places). The indexed cost base is $5,500 x 1.122 = $6,171. This result indicates that Anita is having neither a capital gain nor loss.

Bronze figure

Anita purchased bronze during the period October 1987 and sells the bronze in March of prevailing year, and according to provided calculation Anita has incurred a loss of $1000 from this transaction. The base of this transaction cannot be carried forward because of the loss faced by the Anita

Painting

Anita bought the painting for $470 on year 1987; however, the gain obtained by Anita is unnecessary because the founding element that is the price of the product is below the required rate of $500 as in accordance with section118-10(1) (Hanlon, 2005). Thus, as per rule, Anita has suffered a loss of $1000 and this loss could be used forward in any future collectables calculation.

Part two- General deduction

Data

Total drive = 15000 km

Business drive = 12000

Original price = 60000

Total expense = $6800

Deduction for car expense =?

Solution # 1)

According to the concept of cent per kilometer method, is only applicable for drive equal to or less than 5000. Moreover, it this method is used to calculate the deductible expense for more than 5000 km than addition ...