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Week 3 Gary owns a commercial building and leased his premises to John to conduct a bakery business. Under the lease contract, John is obliged
Week 3 Gary owns a commercial building and leased his premises to John to conduct a bakery business. Under the lease contract, John is obliged to repair any modified or damaged parts of the building after the lease term. However, John fails to repair Gary's building, which was damaged due to machinery and fixtures'instalments. John agreed to pay Gary $3,100 to cover the repair expenses. Required: with reference to relevant legislation and case law discuss the tax treatment of this payment for Gary. (10 marks, maximum 300 words) Week 4 John owns a convenience shop called City Conv. The following events occurred for John during 2019- 2020 financial year. (0) John incurred legal expenses as he was sued for false advertising. (1) John purchased new fridge to the shop - $800. In addition, his builder added more space to the shop front. This cost him $22,000. (ii) John ordered 1000 new T-shirts with printed City Conv's logos for marketing purposes. These costs him $1,500. w (iv) John received a City of Sydney fine for putting his sales item for display outside his shop without a permit. He required to apply for a permit to use the footpath. Required: With reference to relevant legislation and case law advise John on the assessability and/or deductibility of above events. (10 marks, maximum 300 words)
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