Mr. Jonsson is a salesperson handling a line of computer software throughout Western Canada. During 2021, he is paid a salary of $25,400 and receives sales commissions of $47,300. He does not receive an allowance, nor is he reimbursed by his employer for any of his expenses. During the year, Mr. Jonsson made the following employment-related expenditures.
Mr. Jonsson is a salesperson handling a line of computer software throughout Western Canada. During 2021, he is paid a salary of $25,400 and receives sales commissions of $47,300. He does not receive an allowance, nor is he reimbursed by his employer for any of his expenses. During the year, Mr. Jonsson made the following employment-related expenditures.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Mr. Jonsson is a salesperson handling a line of computer software throughout Western Canada. During 2021, he is paid a salary of $25,400 and receives sales commissions of $47,300. He does not receive an allowance, nor is he reimbursed by his employer for any of his expenses. During the year, Mr. Jonsson made the following employment-related expenditures.
|
Airline Tickets
|
$2,310
|
|---|---|
|
Office Supplies And Shipping Costs
|
395
|
|
Purchase Of Laptop Computer
|
2,065
|
|
Client Entertainment
|
1,730
|
|
Cost Of New Car
|
23,800
|
|
Operating Costs Of Car
|
7,500
|
I included the answer in the images, i just need to know how they calculated CCA and operating costs. Can you please show me the steps or the formula thanks.
Transcribed Image Text:Assume that all of the client entertainment was expended while more than 12
consecutive hours away from the employer's place of business.
The new car was purchased on January 5, 2021, and replaced a car that Mr.
Jonsson had leased for several years. During 2021, Mr. Jonsson drove the car a
total of 50,000 kilometres, of which 35,000 kilometres were for employment
purposes and 15,000 kilometres were for personal use. The maximum capital cost
allowance for the car (100 percent) is $10,710.
In addition to expenditures to earn employment income, Mr. Jonsson has the
following disbursements.
Alberta Blue Cross Medical Insurance Premiums
Group Life Insurance Premiums
$395
635
Mr. Jonsson indicates that he regularly receives discounts on his employer's
merchandise and, during the current year, he estimates that the value of these
discounts was $1,100.
One of the suppliers of his employer paid $2,850 to provide Mr. Jonsson with a one
week vacation at a northern fishing lodge.
Transcribed Image Text:The table below could be used to find Mr. Jonsson's employment income.
Salary
Taxable benefit from fishing trip
Commission income
Sales commissions
Deductions:
Airline tickets
Office supplies
Client entertainment (50% of $1,730)
CCA
Operating costs
Total deductions
Net commission income
Employment income
$25,400
$2,850
$47,300
($2,310)
($395)
($865)
($7,497)
($5,250)
($16,317)
$30,983
$59,233
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