Isla runs a bicycle shop in Wellington. During the tax year ending 30 June 2021, her records indicate: Receipts: 135,000 Bicycle Sales 35,000 Spare parts and accessory sales 15,000 Compensation receipt (see note A) 250,000 Proceeds for sale of land (see note B) 1,000 Net interest received from an overseas interest-bearing term deposit (see note C) 5,000 Exempt Income 6,000 Cash dividend income (see note D) 25,000 Net salary and wages (see note E) Payments: 55,000 Purchases of bicycles, spare parts and accessories (see note F) 12,000 Materials (see note G) 39,000 Utilities and rent for the business premises 3,000 Repairs to storage room 1,000 Donation to Oxfam (Deductible gift recipient) ADDITIONAL INFORMATION: (A) - Compensation for damaged trading stock after a storage room was broken into (B) - Isla sold some land purchased in 1984 for $85,000. In 2002 Isla spent $15,000 building new fences for 85% of the boundary after a fire damaged the existing fencing. Isla incurred $13,000 in commissions and advertising fees. Isla had carried forward capital losses of $17,000 from prior years. (C) - Foreign tax withheld includes $100 (D) - Dividends paid include $4,000 in 100% franked dividends, $2,000 in 50% franked dividends. All dividends are paid by companies listed on the ASX (E) - Isla also works part time at a local winery. Her employer withheld $3,500 in PAYG withholding. The $25,000 includes $1,000 in travel allowances and $300 in reimbursed phone bills, for which her employer paid (F) - Opening stock from the prior year $44,000. Closing stock of $37,000 (cost), $42,000 (replacement value). $45,000 (market value). (G) - Materials include glue and paints for putting together or repairing bicycles (H) - Isla has a carry forward Division 36 past year trading tax loss of $8,000 (I) - Isla wishes to minimise her tax liability (J) - Isla has appropriate private health insurance REQUIRED: Calculate Isla's taxable income for the year ended 30 June 2021. You are required to present a complete analysis, explaining the treatment of all items and/or elements in this question
Isla runs a bicycle shop in Wellington. During the tax year ending 30 June 2021, her records indicate:
Receipts:
| 135,000 | Bicycle Sales |
| 35,000 |
Spare parts and accessory sales |
| 15,000 | Compensation receipt (see note A) |
| 250,000 | Proceeds for sale of land (see note B) |
| 1,000 | Net interest received from an overseas interest-bearing term deposit (see note C) |
| 5,000 | Exempt Income |
| 6,000 | Cash dividend income (see note D) |
| 25,000 | Net salary and wages (see note E) |
Payments:
| 55,000 | Purchases of bicycles, spare parts and accessories (see note F) |
| 12,000 | Materials (see note G) |
| 39,000 | Utilities and rent for the business premises |
| 3,000 | Repairs to storage room |
| 1,000 | Donation to Oxfam (Deductible gift recipient) |
ADDITIONAL INFORMATION:
(A) - Compensation for damaged trading stock after a storage room was broken into
(B) - Isla sold some land purchased in 1984 for $85,000. In 2002 Isla spent $15,000 building new fences for 85% of the boundary after a fire damaged the existing fencing. Isla incurred $13,000 in commissions and advertising fees. Isla had carried forward capital losses of $17,000 from prior years.
(C) - Foreign tax withheld includes $100
(D) - Dividends paid include $4,000 in 100% franked dividends, $2,000 in 50% franked dividends. All dividends are paid by companies listed on the ASX
(E) - Isla also works part time at a local winery. Her employer withheld $3,500 in PAYG withholding. The $25,000 includes $1,000 in travel allowances and $300 in reimbursed phone bills, for which her employer paid
(F) - Opening stock from the prior year $44,000. Closing stock of $37,000 (cost), $42,000 (replacement value). $45,000 (market value).
(G) - Materials include glue and paints for putting together or repairing bicycles
(H) - Isla has a carry forward Division 36 past year trading tax loss of $8,000
(I) - Isla wishes to minimise her tax liability
(J) - Isla has appropriate private health insurance
REQUIRED:
Calculate Isla's taxable income for the year ended 30 June 2021. You are required to present a complete analysis, explaining the treatment of all items and/or elements in this question
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