1st July 2021, Hard Rock Pty Ltd a small construction business purchased two business assets for the purpose of producing assessable income. The aggregated turnover for the business was less than 10 million dollars. Remember that Hard Rock Ltd has chosen not to use the simplified depreciation rules in any years. You are required to analyse the two scenarios and calculate any allowable deductions arising from the decline in value of the following assets. Use all the relevant methods to show the difference in the claimable amount. Asset1: An excavator was purchased at the beginning of the year at the cost of $125,000. The estimated life of this asset is 12 years. Asset2: A luxury car on 1st July at the cost of $92,000. The estimated life of the vehicle is eight years. Required: a) How would the business decision choose a method of depreciation for the following two situations? b) What considerations a taxpayer should take in choosing a particular method of d
On 1st July 2021, Hard Rock Pty Ltd a small construction business purchased two business assets for the purpose of producing assessable income. The aggregated turnover for the business was less than 10 million dollars. Remember that Hard Rock Ltd has chosen not to use the simplified
Required:
a) How would the business decision choose a method of depreciation for the following two situations?
b) What considerations a taxpayer should take in choosing a particular method of depreciation?
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