Chapter 3 - solution Assign Problem 3-5.docx

Total car benefit 20240 included on t4 added to

• Homework Help
• 3

This preview shows pages 2–3. Sign up to view the full content.

Total Car Benefit \$ 20,240 – included on T4 (added to income) Misty Dorsey – Employer Leased Car Business Use - 14,000 km / 51,000 km = 27% Standby Charge 2/3 x [Annual Lease payments (incl GST &PST) – Insurance] x Availability Factor = 2/3 x [(\$620 x 12 months) - \$1200)] x 12/12 = \$4,160 -no reduced standby allowed, employment use is less than 50% Operating Costs 1. Primarily employment – ½ x standby charge (cannot use because business use is less than 50%) 2. Kilometre method - \$ 0.27 x 37,000 km = \$9,990 Car Benefit Standby charge \$ 4,160 Operating costs 9,990 Less: Reimbursement (2,400) \$200 x 12 months Total Car Benefit \$11,750 – included on T4 (added to income) Saul Dorsey – Employer Leased Car Business Use - 29,500 km / 31,200 km = 95% Standby Charge 2/3 x [Annual Lease payments (incl GST &PST) – Insurance] x Availability Factor = 2/3 x [(\$1,200 x 8 months) - \$0)] x 8/8 = \$6,400 -reduced standby allowed because business use is greater than 50% \$6,400 x Personal Km/1667 km x availability = \$6,400 x [*1,700 km/ (1667 km x 8 months)]= \$815.84

This preview has intentionally blurred sections. Sign up to view the full version.

Assignment Problem 3-5 (continued) Operating Costs 1. Primarily employment – ½ x standby charge = 1/2 x 815.84 = \$407.92 2. Kilometre method - \$ 0.27 x 1,700 km = \$459 Car Benefit Standby charge \$ 815.84 Operating costs 407.92 Less: Reimbursement (0) Total Car Benefit \$1,223.76 – included on T4 (added to income)
This is the end of the preview. Sign up to access the rest of the document.
• Fall '14
• Kilometre, Totaled

{[ snackBarMessage ]}

What students are saying

• As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

Kiran Temple University Fox School of Business ‘17, Course Hero Intern

• I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

Dana University of Pennsylvania ‘17, Course Hero Intern

• The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

Jill Tulane University ‘16, Course Hero Intern