Question 1 - 12 marks Alpha and Beta, both resident individuals, are in a 50:50 partnership named AB Enterprise. AB Enterprise has been supplying facial masks to health professionals for the past ten years. Due to the COVID-19 pandemic, there was an increased demand for facial masks. To meet the demand, AB Enterprise recruited a new employee. It paid $91,000 for the employee wages and $9,000 for compulsory superannuation contributions on behalf of the employee during the 2020-21 income year. Despite this extra expense this year, AB Enterprise made accounting profits of $200,000. The following items were also included in the Profit and Loss Account. It also received fully franked dividends of $1,400 from its shares held in a local health insurance company (with franking credits of $600 attached to the dividend). AB Enterprise made the following payments pursuant to the partnership agreement. $30,000 salary to Alpha for his active involvement in running the business. $5,000 superannuation contributions to Alpha's superannuation fund. $5,000 interest to Beta for the capital ($5 million) he contributed to the partnership five years ago. For the 2020-21 income year: 1) Work out net income of AB Enterprise. 2) Work out partnership distributions for Alpha and Beta. (4 Marks) (3 Marks) 3) Work out each partner's tax liability (including Medicare levy). (5 Marks) Note: Beta has a carried-forward loss of $10,000 from the preceding year and has earned $13,000 income exempt from tax during the 2020-21 income year. Question 1 - 12 marks Alpha and Beta, both resident individuals, are in a 50:50 partnership named AB Enterprise. AB Enterprise has been supplying facial masks to health professionals for the past ten years. Due to the COVID-19 pandemic, there was an increased demand for facial masks. To meet the demand, AB Enterprise recruited a new employee. It paid $91,000 for the employee wages and $9,000 for compulsory superannuation contributions on behalf of the employee during the 2020-21 income year. Despite this extra expense this year, AB Enterprise made accounting profits of $200,000. The following items were also included in the Profit and Loss Account. It also received fully franked dividends of $1,400 from its shares held in a local health insurance company (with franking credits of $600 attached to the dividend). AB Enterprise made the following payments pursuant to the partnership agreement. $30,000 salary to Alpha for his active involvement in running the business. $5,000 superannuation contributions to Alpha's superannuation fund. $5,000 interest to Beta for the capital ($5 million) he contributed to the partnership five years ago. For the 2020-21 income year: 1) Work out net income of AB Enterprise. 2) Work out partnership distributions for Alpha and Beta. (4 Marks) (3 Marks) 3) Work out each partner's tax liability (including Medicare levy). (5 Marks) Note: Beta has a carried-forward loss of $10,000 from the preceding year and has earned $13,000 income exempt from tax during the 2020-21 income year