(Disposal of depreciatingassets)

Required: The following are all resident taxpayers. In each case, calculate the deduction available for decline in valueas well asany assessable income (if any) arising from the disposals during the 2017/18 taxyear.

a) Hannah sold equipment from her factory on 31 May 2018 for $9,200. The equipment had originally cost $11,000 and was depreciated using the prime cost method using an effective life of 5 years. The opening adjustable value was $6,000 on 1 July 2017. Decline in value on Hannah's other assets was$1,700.

b) Joe sold office equipment from his law practice on 1 November 2017 for $600.The office equipment had an original cost of $1,800 but was added to the low value pool in 2015 when it became a low value asset. The low value pool had an opening balance of $3,500 and there were no additions to the pool during the year.

Q2 (Taxable income from Australian and foreign sources)

Yvette Jankic, a resident single taxpayer aged 31, worked in New Zealand from 1 July 2017 until 15 November 2017 and has provided the following information for the 2017/18 tax year:

Receipts

Interest (net of TFN tax withheld$490) 510

Interest from United Kingdom (net of withholding tax$300) 2,700

Dividend from the U.S. state of Georgia (net of withholding tax$2,100) 3,900

Gross salary - Australian employment (PAYG tax $5,285withheld) 21,000

Reportable fringe benefit as per PAYGSummary 6,252

Net salary - New Zealand employment (tax withheld$2,540) 12,650

Bonus from Australian Employer for exceptionalperformance 2,000

Payments

Interest and Dividend deductions relating to United Kingdomand Georgia investments 250

Work-related deductions relating to Australianemployment 300

Note-Yvettedoesnothaveprivatehealthinsurance.

Required:

a.Calculate Yvette's taxable income for the 2017/18 taxyear.

Yvette's taxable income for the 2017/18 tax year :

Interest(510+TFN tax withheld$490)= 1000

Interest - United Kingdom(2700+net of withholding tax$300) =3000

Dividend - Georgia(3900 +net of withholding tax$2,100)= 6000

Gross Salary - Australia 21,000

Gross Salary - New Zealand (not exempt) (12,650 +tax withheld$2,540) =15,190

Bonus2,000

Gross taxable Income= 48,190

Less: Investment Deductions 250

Work-related Deductions 300

Total deduction =550

TAXABLE INCOME =47,640

b.Calculate Yvette's net tax payable or refundable for the2017/18 taxyear.

Taxable income 47,640

Tax on taxable income = 3,572 + 32.5%* (47,640 - 37,000) = 7,030

Add: Medicare levy = 2% * 47,640 =952.8

Less : Low income tax offset =445 - (1.5% *(47,640-37,000)) = 285.4

Less: PAYG tax withheld =5,285

Less : Foreign Income Tax Offset

can you check if part a is right answer and also part b as well and do we have to add any

other calculations in part b (Please Show your working ).

Notes: part A we have to use this format