Advise marble on the taxation implication of the transaction

Assignment Help Financial Management

Reference no: EM131939461

On 1 July 201 3, Marble Ltd purchased a machine at a cost of $220,000 (GST inclusive) for use in its business. Marble determined the machine to have an effective life of five years and claimed diminishing value depreciation on that basis. Marble used the machine only for business purposes and sold it for $99,000 (GST inclusive) on 30 June 201 7.

1. Advise Marble on the taxation implications of these transactions.

2. How would your advice differ if Marble had sold the machine for only $55,000 (GST inclusive) to a company that has the same shareholders as Marble?

Reference no: EM131939461

Questions Cloud

Describe globalization and its benefit to business operation : Discuss the key differences in cultural variables between the United States and the country that are important when conducting business in the selected country.

What amount of interest expense would magic report : Magic Enterprises borrowed $18,000 from the local bank on Julyl 1, 2010, What amount of interest expense would Magic report on the 2010 income statement

Organizational ability of the hospital : Which is more important in managed care, the capital and organizational ability of the hospital/managed care organization

Describe a potential capital investment project : Describe and estimate specific investment needs and cash flows for the project.Identify and describe a potential capital investment project.

Advise marble on the taxation implication of the transaction : How would your advice differ if Marble had sold the machine for only $55,000 (GST inclusive) to a company that has the same shareholders as Marble?

What is depreciation for any subsequent years : The automobile cost $36,000, and no amounts are expensed under Sec. 179 or bonus depreciation. What is depreciation for 2013-2018 and any subsequent years

What is the minimum number of part-time employees : Suppose Mr. Brewer uses five permanent employees. What is the minimum number of part-time employees he will need

Explain why expected return is considered forward-looking : Explain why expected return is considered forward-looking. What challenges arise in using expected return?

Calculate depreciation using sum-of-the-years digits : On April 29, 2013, Quality Appliances purchased equipment for $260,000. Calculate depreciation for 2013 and 2014

User Account

All Pages