Nicholas works for Computer SpecialistsLtd as a salesman. He is provided with acar that cost the company $45,000 on 1May 2021. Nicholas used the car from thetime that his employer acquired the car.During the FBT year ended 31 March2022 Nicholas travelled 35,000 km in thecar. The car's logbook indicates that thebusiness percentage is 80%. The totaloperating costs including deemed interestand depreciation are $14,000. Nicholaspaid $2,000 of the operating costs for theyear ended 31 March 2022. What is thetaxable value of the car for the yearended 31 March 2022 using the operatingcost basis formula method?a. $9,200b. $2,950c. $800d. $2,800e. $11,200Justify your answer by providingcalculations.

It has been given in the question that the operating cost basis method has to be used for the…

Answered: year ended 31 March 2022. What is the…

year ended 31 March 2022. What is the taxable value of the car for the year ended 31 March 2022 using the operating cost basis formula method?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Nicholas works for Computer Specialists
Ltd as a salesman. He is provided with a
car that cost the company $45,000 on 1
May 2021. Nicholas used the car from the
time that his employer acquired the car.
During the FBT year ended 31 March
2022 Nicholas travelled 35,000 km in the
car. The car's logbook indicates that the
business percentage is 80%. The total
operating costs including deemed interest
and depreciation are $14,000. Nicholas
paid $2,000 of the operating costs for the
year ended 31 March 2022. What is the
taxable value of the car for the year
ended 31 March 2022 using the operating
cost basis formula method?
a. $9,200
b. $2,950
c. $800
d. $2,800
e. $11,200
Justify your answer by providing
calculations.

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