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The work was authorised and completed before the first tenants moved in. Soon after, a section of the upstairs floor collapsed, and Pam was advised

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The work was authorised and completed before the first tenants moved in. Soon after, a section of the upstairs floor collapsed, and Pam was advised that the property was infested with white ants and that it would be necessary to spend another $25,000 in having the entire flooring replaced with improved timber. Required: A) Is Pam entitled to a deduction for the $34,000 or any part? (5 marks) B) Will a deduction be allowed for an additional cost of $1,600 paid to pest control experts who have treated the remaining parts of the building? (2.5 marks) The work was authorised and completed before the first tenants moved in. Soon after, a section of the upstairs floor collapsed, and Pam was advised that the property was infested with white ants and that it would be necessary to spend another $25,000 in having the entire flooring replaced with improved timber. Required: A) Is Pam entitled to a deduction for the $34,000 or any part? (5 marks) B) Will a deduction be allowed for an additional cost of $1,600 paid to pest control experts who have treated the remaining parts of the building? (2.5 marks)

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