Question 2 (25 marks) Randy Rais wanted to start home-based business that would specialize in selling posters. The business would be operated from his principal residence. He set aside 20% of the total oor space the resident or the poster operations, In. Randy Rafts principal residence, costing 5970.000 in total, was acquwed on January 01, 2019. It is estimated that 5270.000 of this total value can be attributed to the land value Mr Randy Ratt incurred the following 2019 costs relating to the principal residence: Chilities for the Home Heat, and Water $3,300 More Interest Paid 12,000 Hose Insurance 3,300 Property Taxes 7,700 Repair & Maintenance for the Home 9,300 Total House Costs $35.500 The business commenced operations on February 01, 2019. On that date. Mr. Randy Raft purchased the following assets to be used in this new business Office Furniture Shelving 560,000 Computer 1.000 Basies were 4000 Total Pursuses 571 000 Weddin Md. Ranu Rot had separate telephone line installed for dealing with the mail order business Durine me period February 1 20 rough December 31, 2019. Mr. Randy Raft's maid order sales tomated $900.000. Coses associated with these sales included the following Cast of Merchandise Pechased mold Merchandise Deceber 31, 2019 Packaging Materials Mailing Costs Office Supplies Tdephone Clues Printing of Brochures Mein Yeh Mas En Cow Tu Costs 750,000 40.000 30,000 45.000 18.00 5.000 16.000 25.000 15.000 51.025,000 Required: ACM Rund an deduct work space in the home costs Briefly explain your decision B.Com Randys 2019 minimum net business income or loss that he will report on his 2019 income tax return na mues that should be discussed with Mr. Randy Raft regarding the work space in his home and business costs Question 2 (25 marks) Randy Rais wanted to start home-based business that would specialize in selling posters. The business would be operated from his principal residence. He set aside 20% of the total oor space the resident or the poster operations, In. Randy Rafts principal residence, costing 5970.000 in total, was acquwed on January 01, 2019. It is estimated that 5270.000 of this total value can be attributed to the land value Mr Randy Ratt incurred the following 2019 costs relating to the principal residence: Chilities for the Home Heat, and Water $3,300 More Interest Paid 12,000 Hose Insurance 3,300 Property Taxes 7,700 Repair & Maintenance for the Home 9,300 Total House Costs $35.500 The business commenced operations on February 01, 2019. On that date. Mr. Randy Raft purchased the following assets to be used in this new business Office Furniture Shelving 560,000 Computer 1.000 Basies were 4000 Total Pursuses 571 000 Weddin Md. Ranu Rot had separate telephone line installed for dealing with the mail order business Durine me period February 1 20 rough December 31, 2019. Mr. Randy Raft's maid order sales tomated $900.000. Coses associated with these sales included the following Cast of Merchandise Pechased mold Merchandise Deceber 31, 2019 Packaging Materials Mailing Costs Office Supplies Tdephone Clues Printing of Brochures Mein Yeh Mas En Cow Tu Costs 750,000 40.000 30,000 45.000 18.00 5.000 16.000 25.000 15.000 51.025,000 Required: ACM Rund an deduct work space in the home costs Briefly explain your decision B.Com Randys 2019 minimum net business income or loss that he will report on his 2019 income tax return na mues that should be discussed with Mr. Randy Raft regarding the work space in his home and business costs
