QUESTION 3 (20 marks) Yan Lee enters into a contract with Trevor on 1 January 2016 to purchase a factory from Trevor for $1 million. Yan pays Trevor $800,000 and also transfers to Trevor shares worth $200,000. Additional costs of purchase are: (a) legal fees $10,000, (b) stamp duty $50,000, and (c) tax advice on how to structure the deal $8,000. On the basis of that advice, the factory is purchased in the name of Yan's family company. Yan then uses the factory for income producing purposes. Soon after taking possession of the factory, Yan finds some of the walls need replacing because of white ants: cost $46,000. In December 2016, the outside walls of the factory are repainted because the paint is peeling: cost $38,000 (Yan claims this as a tax deduction in her tax return for the 2016/17 year). In January 2017, Yan pays a landscape gardener $84,000 to beautify the grounds around the factory (trees, paths, etc). During her ownership, Yan also pays rates ($22,000), insurance premiums ($25,000) and interest on the loan taken out to finance the purchase of the factory ($33,000). In March 2019, Trevor is accused of forging title deeds and of fraudulently asserting ownership of the factory that he sold to Yan. In danger of losing the factory, Yan incurs $80,000 court costs to successfully defend her ownership In June 2019 Yan sells the factory for $2.5 million. To arrange the sale, she incurs advertising costs of $10,000 and legal fees of $50,000. PREPARE A REPORT advising Yan Lee on the CGT consequences arising from the transactions outlined above. In your report, particular attention should be given to explaining whether a capital gain or a capital loss was realised when the factory is sold? If a capital gain was realised, how much would be taxable