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Business Laws - Sample Assignment PDF

   

Added on  2021-05-31

8 Pages1393 Words29 Views
Running Head: BUSINESS LAWBusiness LawName of the Student:Name of the University:Author Note

1BUSINESS LAWAnswer 1Provisions in relation to deductions are provided under the provisions of SECT 8-1 of theINCOME TAX ASSESSMENT ACT 1997. It has been stated by the section that an expense orloss which has been generated for the purpose getting the assessable income is deductible. In thecase of Herald and Weekly Times Ltd v FCT the court held that the legal fees which had beenincurred in relation to defending a claim for defamation by a newspaper company are deductible.This is because the defamation was related to a publication used to gain assessable income. Thusin the present case the legal expenses incurred by Paper co for defending the criminal claimwhich was related to the way in which they get their assessable income is will also be deductibleAnswer 21.As per section 110-25(4) of the ITAA any cost of maintaining or repairing a property isthe third element of cost base. thus the repair of the pipeline would be cost base even ifthe property is rented out.2.110-25(3) of the ITAA 97 makes it the second element of cost base as the fees paid to theauctioneer in the given situation is an incidental expense.3.Under the provisions of s. 110-55(1) this would not be a cost base as there is a loss in thegiven situation and element 3 which is the cost of ownership is not included in thereduced cost base. 4.The Cost of acquiring in the given situation would be $400 000 as per the market valueand under 110-25(2) it would be a cost base.

2BUSINESS LAWAnswer 3The total proceeds is 640000 as along with the sale price of 600000 Claude received a boat worth$40000 and as per section 116.20(1) The capital proceeds are Money received and market valueof any form of property which is received against the sale. Here Claude chooses flat 50%deduction rather than indexation. The following is the capital gain which she has got. Proceeds $$CGT Event A1 section 116-30(Sale)600000Boat Received40000Net Capital Proceeds 640000Cost Base section 110-25first element (purchaseprice)300000second element (Legalcost)12000Net Cost Base312000Capital Gain (Net Capital Proceeds -NetCost Base)328000 Less 50% as property purchased before21/9/1999 164000Total CapitalGain 164000Answer 4Under section 40-25 of ITAA 97 a deduction can be claimed against the value of declining assetswhich are used for producing an assessable income. The Diminishing value depreciation methodhas been used to calculate the depreciation in this case under section 40-70.Diminishing value depreciation section 40-70Particulars Amount ($)

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