Solution to Assignment Problem Five 9,10

Solution to Assignment Problem Five 9,10 - Solution to...

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Solution to Assignment Problem Five - 9 Mr. Jones’ net employment income would be calculated as follows: Salary $25,800 Taxable Benefit From Fishing Trip 2,450 Commission Income Sales Commissions $47,700 Deductions: Airline Tickets ($2,350) Office Supplies ( 415) Client Entertainment [(50%)($1,750)] ( 875) CCA (Note 1) ( 2,520) Operating Costs (Note 2) ( 5,040) ( 11,200) 36,500 Net Employment Income $64,750 Notes: 1. The deductible capital cost allowance on the car would be calculated as follows: Full Capital Cost Allowance $ 3,600 Employment Related Usage Proportion (35,000/50,000) 70% Deductible Amount $ 2,520 2. As the car was used 30 percent on personal matters, only 70 percent of the $7,200 in operating costs would be deductible. 3. The laptop computer is a capital expenditure and is not deductible as an expense. Since an employee cannot deduct CCA except for an automobile, musical instrument, or aircraft, the purchase of the laptop computer would not have any effect on either employment income or taxes payable. 4.
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This note was uploaded on 06/17/2008 for the course ACCT 321 taught by Professor Smith during the Spring '08 term at University of Calgary.

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Solution to Assignment Problem Five 9,10 - Solution to...

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