AUSTRALIAN TAX

QUESTION 2 (9 marks) Surfgear Pty Ltd sells surfboards from its Gold Coast, Queensland, retail store. Surfgear is registered for Goods and Services Tax (GST) and reports on the accruals (non-cash) basis each quarter. Below are Surfgear's transactions for the June 2020 quarter. All amounts include GST where applicable and valid tax invoices are held for acquisitions: 1. Surfgear's retail store had invoiced sales totalling $275,000 for the quarter. 2. Surfgear sold 100 surfboards to a surf shop in New Zealand, sending the surfboards by airfreight after invoicing the customer $50,000. 3. Surfgear bought materials for making surfboards from Australian wholesalers, and the purchases during the quarter totalled $88,000. 4. Refunds paid to customers for returned and faulty goods totalled $2,200 for the quarter. 5. Salaries and wages paid to employees $44,000. 6. Interest paid on a bank loan to $3,300. 7. Electricity and telephone charges $1,650. 8. Teabags, instant coffee and milk for the staff kitchen $200. Required: Explain the GST consequences of each of the above transactions. You must also calculate the GST payable or input tax credit available for each of the transactions for the June 2020 quarter. Show all explanations, calculations and references to the ANTS (Goods and Services Tax) Act 1999. QUESTION 2 (9 marks) Surfgear Pty Ltd sells surfboards from its Gold Coast, Queensland, retail store. Surfgear is registered for Goods and Services Tax (GST) and reports on the accruals (non-cash) basis each quarter. Below are Surfgear's transactions for the June 2020 quarter. All amounts include GST where applicable and valid tax invoices are held for acquisitions: 1. Surfgear's retail store had invoiced sales totalling $275,000 for the quarter. 2. Surfgear sold 100 surfboards to a surf shop in New Zealand, sending the surfboards by airfreight after invoicing the customer $50,000. 3. Surfgear bought materials for making surfboards from Australian wholesalers, and the purchases during the quarter totalled $88,000. 4. Refunds paid to customers for returned and faulty goods totalled $2,200 for the quarter. 5. Salaries and wages paid to employees $44,000. 6. Interest paid on a bank loan to $3,300. 7. Electricity and telephone charges $1,650. 8. Teabags, instant coffee and milk for the staff kitchen $200. Required: Explain the GST consequences of each of the above transactions. You must also calculate the GST payable or input tax credit available for each of the transactions for the June 2020 quarter. Show all explanations, calculations and references to the ANTS (Goods and Services Tax) Act 1999