Calculate fbt liability for the loans

Assignment Help Finance Basics
Reference no: EM132632551

You are the junior accountant at CBW Bank. You have been asked to assist with the 30 June 2020 tax work:

i) The Bank provided loans totaling $5,000,000 in mortgage loans, equally to 10 of its staff during the year. These loans were interest only repayments and were made at arm's length, at an interest rate of 5.37%.

ii) Due to a staff restructuring at the bank, 3 of the staff who took mortgage loans were made redundant on 30 November 2019. Due to financial hardship on these 3 staff, the Bank waived the interest on the loans for a period of one year.

iii) The bank paid the mobile phone bills for these 10 staff during the current tax year. The monthly bill per staff member was $69.

Required:

1) Calculate FBT liability for the loans. Show all workings.

2) Calculate FBT liability for the mobile phone. Show all workings.

Reference no: EM132632551

Questions Cloud

What will the tuition payments be : Savings, accounting for the fact that the interest rate and inflation rate will vary over time. Suppose it is now September 1st
Describe the questions that will be addressed : To ensure the success of a program evaluation, a social worker must generate a specific detailed plan. That plan should describe the goal of the evaluation.
What is the actual meaning of actual sales : What is the actual meaning of actual sales for this question? why they give this information to you ? can only use the information to make sales budget
Operating and nonoperating components of income statement : Distinguish between the operating and nonoperating components of the income statement.
Calculate fbt liability for the loans : You are the junior accountant at CBW Bank. You have been asked to assist with the 30 June 2020 tax work:
Question - How do calculate the value of this bond : Question - How do calculate the value of this bond? Calculate the value of the bond shown in the following table, assuming it pays interest annually
What is the value of your account on april 1 : On January 1, you sold short one round lot (that is, 100 shares) of Four Sisters stock at $21 per share. On March 1, a dividend of $2 per
Question - Journalize the transactions : Question - Journalize the transactions - Sunland Clark opened Sunland's Cleaning Service on July 1, 2020
Why the adjustment is necessary for under absorption : Fixed production overheads are £3,000, Explain why the adjustment is necessary for under and over absorption of overheads in the absorption costing model.

Reviews

Write a Review

Finance Basics Questions & Answers

  Scientists believe about the origin of life on earth

There is a summary statement concerning what scientists believe about the origin of life on earth. Summarize the three (3) current competing theories of the origin of life on Earth: it arrived from an extraterrestrial source, it originated as a he..

  Invest a fictitious 600000 in two stocks-300000 in each

invest a fictitious 600000 in two stocks-300000 in each stock-by referring to the financial times and the wall street

  Calculation of effective yield of a discount bond

A discount bond has a face value of $10,000 and promises repayment at the end of 15 years and has a market price of $3541. What is its effective yield?

  Calculate the after-tax cash flow at disposal

AAA has a tax rate of 30%. The asset is sold at the end of year 4 for $11211. Calculate the after-tax cash flow at disposal.

  Describe the term capital budgeting

Describe the term Capital budgeting and explain what are the 30 equal annual payments

  Calculate the present value of the firm tax saving

Value the present value of a firm's tax saving due to new debt that they will add for an add on project that will last for three years.

  The asset report

The debentures were completely subscribed and the cash were appropriately gotten. Demonstrate the money book and diary sections and set up the asset report of the organization.

  Determine the value that is described in each of the

determine the value that is described in each of the following investments. assume that no money is withdrawn during

  Most you would be willing to pay for alfa growth

You are considering the purchase of a share of Alfa Growth, Inc. common stock. You expect to sell it at the end of one year

  How would you define transaction exposure

How would you define transaction exposure? How is it different from economic exposure?

  Benefits of utilizing a flow chart to define a work process

Suggest the major benefits of utilizing a flow chart to define and improve a work process. Outline the key steps required to construct and develop an effective flow chart

  Develop a six-month cash budget

Develop a Six-month Cash Budget (from October 2019 to March 2020) (1) arrange for a short-term borrowing agreement

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd