Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Miguel owns an antique vase which is about 200 years old. He paid the market value of $100,000 to acquire the vase 5 years ago.

Miguel owns an antique vase which is about 200 years old. He paid the market value of $100,000 to acquire the vase 5 years ago.

On the night of 12 November 2018, there was a fire on Miguel's premises and the vase was destroyed along with other property.

Miguel's insurance company paid him $75,000 on 6 July 2019, under his insurance policy.

Which of the following statements isTRUE?

Select one:

Miguel has incurred a capital loss of $100,000 in the 2018/19 financial year, and a capital gain of $75,000 in the 2019/20.

None of these

Miguel will incur a capital loss of $25,000 in the 2019/20.

Miguel will incur a capital loss of $25,000 in the 2018/19 financial year.

Miguel's insurance company has incurred a capital loss of $75,000 in the 2019/20 year.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Practicing Financial Planning

Authors: Sid Mittra, Anandi P Sahu, Brian Fischer

12th Edition

9386042851, 9789386042859

More Books

Students also viewed these Accounting questions

Question

What is the difference between process and product layout systems?

Answered: 1 week ago

Question

8. How can an interpreter influence the message?

Answered: 1 week ago