QUESTION 1 Part A Ahmed is a 44 year-old single male resident of South Africa. He inherited a 5 bedroom house situated in Eshowe from his grandfather. As he works in Durban he decided to sell the house for R1 350 000. The value of the house was estimated at R1 200 000 by the property valuator. The house was sold on 31 August 2023. Immediately after he received the money from the sale of the house, he invested it with a private local company, Coral Property Investment. By 29 February 2024, he earned a dividend of 4% based on his total investment. Ignore VAT REQUIRED: (30 Marks) Discuss with reference to the gross income definition whether or not the amounts received by Ahmed will form part of his gross income for the year ended 29 February 2024. (10 Marks)
QUESTION 1 Part A Ahmed is a 44 year-old single male resident of South Africa. He inherited a 5 bedroom house situated in Eshowe from his grandfather. As he works in Durban he decided to sell the house for R1 350 000. The value of the house was estimated at R1 200 000 by the property valuator. The house was sold on 31 August 2023. Immediately after he received the money from the sale of the house, he invested it with a private local company, Coral Property Investment. By 29 February 2024, he earned a dividend of 4% based on his total investment. Ignore VAT REQUIRED: (30 Marks) Discuss with reference to the gross income definition whether or not the amounts received by Ahmed will form part of his gross income for the year ended 29 February 2024. (10 Marks)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:QUESTION 1
Part A
Ahmed is a 44 year-old single male resident of South Africa. He inherited a 5 bedroom house situated in
Eshowe from his grandfather. As he works in Durban he decided to sell the house for R1 350 000. The value
of the house was estimated at R1 200 000 by the property valuator. The house was sold on 31 August 2023.
Immediately after he received the money from the sale of the house, he invested it with a private local
company, Coral Property Investment. By 29 February 2024, he earned a dividend of 4% based on his total
investment.
Ignore VAT
REQUIRED:
(30 Marks)
Discuss with reference to the gross income definition whether or not the amounts received by Ahmed will
form part of his gross income for the year ended 29 February 2024.
(10 Marks)
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