Question 3 Required: Showing workings, calculate (citing authority where appropriate):

Jenny's deductions regarding the desktop and smart phone for the current 2022- 23 tax year; and

Bill's deduction for the printer for the current 2022-23 tax year

For both Jenny and Bill, where there is a choice of methods in calculating the deductions, use the method that will give the highest deductions for the tax year (4 marks).

Jenny works as an employee real estate agent. On 10 May 2023, she purchased a new desktop computer for $1200 (it had an effective life of 4 years). On 20 May 2023 the desktop's CPU (Central Processing Unit) stops working, and she replaces it on that day with a more powerful CPU that cost $400.

Jenny uses the desktop 70% for work purposes, 20% for private purposes and 10% for her studies (as she is studying for a Diploma of Real Estate).

On 1 June 2023, Jenny also purchased a cheap smartphone (effective life of 3 years) that she uses only for work purposes. It cost her $250.

Jenny's friend, Bill, carries on a small printing business (as a sole trader) which has an annual turnover of $400,000. On 10 May 2023, Bill buys a new industrial printer (which has an effective life of 10 years) for $60,000, which is only used for his business.