1-Which of the following is deductible to the partnership against…

QuestionAnswered step-by-step1-Which of the following is deductible to the partnership against…1-Which of the following is deductible to the partnership against the partnership net income? a.Interest paid by the partnership on loans made by a partner where that borrowed money was used to provide working capital to the partnership  b.Interest on partners’ capital contributions  c.Drawings made by the partners  d.Partners’ salaries paid to the various partners 2-Iron Pty Ltd, an Australian public company, that is not a small business entity, has provided you with the following information for the 2020-21 tax year, so that you can advise the company accountant of its entitlement to any deductions. The company uses accrual accounting for income recognition.Estimated bad debts, $6000Provision for doubtful debts, $2,000Debts written off during the year, $5,000One years advertising paid on 1 January 2021 to a magazine $30,000.The total allowable deduction for Steel Pty Ltd based on these four transactions is a.$20,000  b.$35,000  c.$41,000  d.$43,000  3-Edward is required to travel for work. Which one of the following statements is correct regarding his claiming of his travel expenses?a.Edward is required to keep a travel diary for any travel, away from his usual residence, that is for more than 6 nights in a row  b.Edward does not need to keep any records regarding his travel as his employer will write a letter confirming that Edward was required to travel for work purposes and this will be sufficient evidence  c.Edward can jot some basic notes in his diary about when he left his usual residence and when he returned and this will be sufficient even for travel for more than 6 nights in a row  d.Edward does not need to keep any records and can deal with his record keeping whenever he is subject to an audit   4-Doris is an employee and of recent times she has been required to work from home. Which type of expenses can Doris claim (as long as she keeps appropriate records)?a.A portion of her home running expenses such as electricity and gas and decline in value and repairs of depreciable assets  b.A portion of her home running expenses such as council and water rates and home insurance and interest on her mortgage  c.A portion of her home occupancy expenses such as council and water rates and home insurance and interest on her mortgage  d.No expenses can be claimed as her home is a private asset  5-DKN Pty Ltd owns machinery that has an effective life of 10 years. The written down value of the machinery as at 1 June 2021 was $51,850. On 1 June 2021, the company sold the machinery for $56,000. Does DKN Pty Ltd have to include any amount into assessable income or is it able to claim a deduction for the disposal of the machinery?a.$4,150 deduction allowed  b.$5,141 deduction allowed  c.$415 to include in assessable income  d.$4,150 to include in assessable income  6-Which one of the following beneficiaries is not under a legal disability?a.Jake who is an undischarged bankrupt.  b.Blake who is mentally disabled and needs permanent care.  c.Drake who is a 35-year-old engineer.  d.Zake who is aged 16 and is a high school student.  7-Ace Accountants is a partnership that has purchased a new car for use in the partnership. The car cost $95,000 and the car was purchased on 17 March 2021 and is used 100% for the partnership business. Ace Accountants is a small business entity. What is the decline in value that the partnership can claim in its partnership tax return for the year ended 30 June 2021?a.$95,000  b.$59,136  c.$14,250  d.$8,637   8-Tom is a junior barrister and during the tax year 2021 he has spent $2,000 on his barrister’s gowns. Tom has also spent $1,000 on two suits that he wears when he sees clients. What amount of clothing expenditure is Tom likely to be able to claim for the year ended 30 June 2021?a.$0  b.$1,000  c.$2,000  d.$3,000   9-Hari is currently working as a security guard and he works at various venues ensuring that patrons are able to enjoy a safe environment. His employer has advised him to eat more steaks and bread each week to ‘beef up’ so that he can have a more muscular body to help carry out his security duties even better. Is Hari likely to be able to be able to claim the extra cost of his food he is now required to spend each week because if his employer’s direction?a.The expenses on food would be capital in nature and so no deduction would be allowed  b.The essential character of a food expense denies a deduction for food in these circumstances  c.The essential character of a food expense allows a deduction for food in these circumstances  d.Hari is not entitled to a deduction on food expenses as there is a specific provision in Division 26 that denies a deduction  10-Which one of the following statements best describes the treatment under section 8-1 ITAA97 of expenses incurred before the business has started?a.Expenses incurred before a business has commenced are deductible  b.Expenses incurred before a business has commenced can be apportioned, under section 8-1, over 5 years  c.Only certain expenses incurred before a business has commenced are deductible  d.Expenses that are incurred before a business has commenced are not deductible   11-Western Hardware Store uses a periodic inventory system and provides the following information about their trading stock.Opening stock $12,000Purchases $57,000Closing stock (cost) $9,000Of the $9,000 of closing stock, $2,000 is past its “use-by” date and must be destroyed.What is the allowable deduction for the purchases and adjustments of trading stock that Western Hardware Store is entitled to for the year ended 30 June 2021?a.$57,000  b.$62,000  c.$54,000  d.$60,000  12-Max Smart and Cheryl Smith are in partnership sharing profits or losses equally. The partnership carries on a trading business and has investments in shares.The net income from the business is $80,000 and the fully franked dividends total $21,000.Calculate the assessable income of each partner.a.$50,500  b.$40,000  c.$50,500  d.$55,000  13-How should ABC Manufacturing Pty Ltd treat its provision for annual and long service leave entitlements in its tax records?a.Provisions for annual and long service leave are incurred for taxation purposes and so do result in a tax deduction  b.Provisions for annual and long service leave are not incurred for taxation purposes and so do not result in a tax deduction  c.Provisions for annual and long service leave do result in the employer being committed to making the expenditure at that time and so do result in a tax deduction  d.As accounting standards, such as AASB 119 Employee Benefits,the entity to recognise an expense and a corresponding provision (being a liability) for leave entitlement, the same treatment applies for taxation purposes  14-In the 2021 tax year, Andrew derived $60,000 in assessable income but had deductions of $90,000. If Andrew also derived $20,000 of exempt income, what would Andrew’s tax loss be for the 2021 tax year?a.$0  b.$20,000  c.$30,000  d.$10,000  15-Which of the following is not an example of an out of scope supply?a.A supply of salary and wages  b.Superannuation contributions  c.Depreciation expenses  d.A sale of a motor vehicle which is recorded as a business asset by an entity registered for GST   16-VKC Enterprises Pty Ltd had Australian assessable income of $260,000 and received some foreign income, which consisted of the following: a cash dividend from a Singaporean company for $9,000 (net of $1,000 Singaporean tax that had been withheld from that payment) and interest from a US bank of $4,500 (net of $500 in US withholding tax withheld from it). What is the assessable income of VKC Enterprises?a.$260,000  b.$275,000  c.$273,500  d.$274,500  17-Which of the following is correct regarding the claiming of input tax credits in respect to the purchase of a car for business use?a.If a car is purchased for $120,000, the maximum input tax credit that can be claimed is $5,376  b.If a car is purchased for $120,000, the maximum input tax credit that can be claimed is $10,909  c.If a car is purchased for $55,000 and is used 50% for business purposes, the maximum input tax credit that can be claimed is $5,000  d.If a car is purchased for $22,000 for private purposes the maximum input tax credit that can be claimed is $2,000  18-Daisy, an Australian resident taxpayer, received a fully franked dividend of $2,800 from a small family company; Step Up Pty Ltd. Step Up Pty Ltd is a base rate entity (and so pays tax at 26%). What amount does Daisy have to include in her assessable income as a result of receiving this fully franked dividend?a.$4,000  b.$1,062  c.$2,800  d.$3,784  19-Roger is a sole trader who sells various electrical items such as flat screen UHD television sets. Roger decides to take one flat screen UHD television set from his store for his own personal use. The television set cost $1,500 and retails for$3,000. The current replacement cost of this same make and model set is $1,800. What amount does Roger need to show into his business income for the stock taken for his own use?a.$3,000  b.$1,500  c.$1,800  d.$0  20-Peter Nolan runs a small jewellery shop in the outskirts of Melbourne and provides specialised advice on all purchasers. Peter employs two permanent staff and is registered for the GST. For the tax period ending 31 March 2021, Peter reported the following transactions and uses the cash basis of accounting for GST.Receipts (inclusive of GST where appropriate)Cash sales: $55,000Credit sales outstanding: $7,700Gift vouchers issued: $4,400Expenses (inclusive of GST where appropriate)Cash purchases: $22,000Staff salaries: $45,000Electricity: $990Gas heating: $880Telephone: $440Assuming that all tax invoices are held where appropriate, the net amount of GST for the tax period ending 31 March 2021 is:a.$5,690  b.$3,190  c.$2,790  d.$3,000       LawSocial ScienceTax lawBUSN 9118Share Question