a.Calculate the depreciation that APC Pty Ltd can claim on its 2017/18 tax return. (4 marks) $30,000 x 40%= $12,000 $12,000 x 15% = $1,800 $700 (printer) $68,720 x 30% = $20,616 $1,800 + $700 + $20,616 = $23,116 b.Calculate the opening value of the general small business pool for 2018-19. (2 marks) 30/06/2018 –01/07/2019 Opening balance 01/07/2017 $68,720 + Assets $12,000 $700 - Depreciation $23,116 Total $58,304 c.What specific records should APC Pty Ltd maintain to ensure the company has chosen the right setting to apply the simplified depreciation rules and how long should those records be kept? (2 marks) 1.Workings opening pool balance 2.Any sold assets 3.Any private or business use of their assets changes. These should be keep for 5 years.
4. XYZ Pty Ltd is a new business and provides you their first-year financial statements for tax calculation. XYZ Pty Ltd Profit & Loss Statement For the year ended 30 June 2018Sales $66,000 Less: Expenses Advertising $3,000 Entertainment $1,000 Depreciation $2,000 Other expenses $25,000 $31,000 Profit $35,000 XYZ Pty Ltd Balance Sheet As at 30 June 2018 Cash at bank $19,100 Accounts receivable $10,000 $29,100 Property, plant and equipment –at cost $10,000 Less: Accumulated depreciation ($2,000) $8,000 Total assets $37,100 Amount due to shareholders $2,000 Net assets $35,100 Share capital $100 Current year earnings $35,000 Total Equity $35,100 Additional information: Under taxation legislation, revenue will be taxable when received. The taxation depreciation for property, plant and equipment is $1,000. Under taxation legislation, no deduction is allowed for entertainment expenditure.
Required:Calculate how much income tax that XYZ Pty Ltd should pay for the year ended 30 June 2018. Show all the working. (5 marks) Assessable income: $66,000 - $10,000 = $56,000 Allowable deductions: $3,000 + $1,000 + $25,000 = $29,000 Taxable income: $56,000 - $29,000 = $27,000 Tax Rate: 27.5% Tax payable = 27,000 X 27,5% = 7,425
Part B –Project ABC Pty Ltd run a restaurant business. The company uses the cash basis when accounting for GST and is required to use Option 1 to prepare and lodge a Business Activity Statement (BAS) for the period 1 April to 30 June 2018. ABC Pty Ltd is required to pay PAYG instalments quarterly. There are two options to calculate how much to pay: Option 1: ABC Pty Ltd is required to pay instalment amount of $15,000 quarterly. Option 2: ABC Pty Ltd is required to pay PAYG instalment with the instalment rate of 4% in each quarter. ABC Pty Ltd chooses Option 2 to work out the amount for PAYG instalments. The following information has been summarised from the company’s book for therequired period and is to be used when completing the calculation sheet and BAS. Receipts and Income Sales (including GST) $295,000 Bank interest from the accounts under company’s name $1,000 Dividend income $5,500 Payments and Purchases Purchase of meats and vegetables $90,000 Purchase of bottled drinking water $1,100 Purchase of carbonated beverages $14,300 Quarterly rent $44,000 Purchase of cash registers and computers (100% related to business) $22,000 All the other operating expenses (including GST) $45,300 GST payment for previous quarter to ATO $3,000 Total salary paid to the employees $60,000 Tax withheld $12,000
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