ANS Partnership is formed by Au, Ng, and Super Ltd and is carrying business in Hong...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
ANS Partnership is formed by Au, Ng, and Super Ltd and is carrying business in Hong Kong. They share the partnership profit/loss in the ratio of 1:2:2. On 1 July 2008. Au left the partnership and her share was taken up by Andy. The profit/loss sharing ratio remained the same after the change. For the year ended 31 December 2008, the partnership's results were: Sales Rent (note) Depreciation Wages to Au Wages to Ng Wages to Andy Wages to Andy's brother, as clerk Loan interest to Ng Loan interest to Super Ltd Sale goods taken by Au Other allowable expenses Net profit/(loss) 500,000 (300,000) (137,500) (20,000) (90,000) (30,000) (100,000) (75,000) (30,000) (5,000) (20.000) (307,500) Notes: Rent of $200,000 was paid to Super Ltd, the landlord of the premises in which the business was operated. The remaining amount was a deposit for the lease. Additional information: (1) The tax depreciation allowance for the year as agreed with the Inland Revenue Department is $200,000. (2) For the year of assessment 2008/09, Ng elected for personal assessment. (3) Super Ltd also carries on a separate business in Hong Kong, from which it has an assessable profit of $20,000 for the year of assessment 2008/09. REQUIRED: a) Compute the profits tax liability of the partnership in respect of the year of assessment 2008/09, and state the respective tax positions of the individual partners under the partnership. b) Assuming that Au had a balance of loss shared from the partnership at the time she withdrew from the partnership, state the tax treatment of that loss and advise her how to maximise its tax effectiveness. c) Assuming that Ng also carries on another proprietorship business as Ng Kee Company which incurred a tax loss during the assessment year 2008/09, advise whether and how that loss could be used to offset against Ng's share of the partnership profit. ANS Partnership is formed by Au, Ng, and Super Ltd and is carrying business in Hong Kong. They share the partnership profit/loss in the ratio of 1:2:2. On 1 July 2008. Au left the partnership and her share was taken up by Andy. The profit/loss sharing ratio remained the same after the change. For the year ended 31 December 2008, the partnership's results were: Sales Rent (note) Depreciation Wages to Au Wages to Ng Wages to Andy Wages to Andy's brother, as clerk Loan interest to Ng Loan interest to Super Ltd Sale goods taken by Au Other allowable expenses Net profit/(loss) 500,000 (300,000) (137,500) (20,000) (90,000) (30,000) (100,000) (75,000) (30,000) (5,000) (20.000) (307,500) Notes: Rent of $200,000 was paid to Super Ltd, the landlord of the premises in which the business was operated. The remaining amount was a deposit for the lease. Additional information: (1) The tax depreciation allowance for the year as agreed with the Inland Revenue Department is $200,000. (2) For the year of assessment 2008/09, Ng elected for personal assessment. (3) Super Ltd also carries on a separate business in Hong Kong, from which it has an assessable profit of $20,000 for the year of assessment 2008/09. REQUIRED: a) Compute the profits tax liability of the partnership in respect of the year of assessment 2008/09, and state the respective tax positions of the individual partners under the partnership. b) Assuming that Au had a balance of loss shared from the partnership at the time she withdrew from the partnership, state the tax treatment of that loss and advise her how to maximise its tax effectiveness. c) Assuming that Ng also carries on another proprietorship business as Ng Kee Company which incurred a tax loss during the assessment year 2008/09, advise whether and how that loss could be used to offset against Ng's share of the partnership profit.
Expert Answer:
Answer rating: 100% (QA)
a Compute the profits tax liability of the partnership in respect of the year of assessment 200809 and state the respective tax positions of the individual partners under the partnership To compute th... View the full answer
Related Book For
Smith and Roberson Business Law
ISBN: 978-0538473637
15th Edition
Authors: Richard A. Mann, Barry S. Roberts
Posted Date:
Students also viewed these accounting questions
-
Question 1 This question has two parts, (A) and (B). Answer both parts. 100% Liverpool plc is a company that manufactures a number of different types of electrical goods and has a year end of 31...
-
Section 1 Personal Information (1) Tim Choi, HKID D987654(3); Grace Lam: HKID D123456(7). Both are HKPR. (2) Tim and Grace are married with three children, Daniel and Maria, their biological...
-
Question 2: What kind of path/steps should the researcher follow, who wants to demonstrate/support the view that "There is a relationship between the COVID-19 spread indicators (cases, number of...
-
Copper Industries (a sole proprietorship) sold three 1231 assets during 2015. Data on these property dispositions are as follows: a. Determine the amount and the character of the recognized gain or...
-
Identify each of the following accounts of Sesame Services Co. as asset, liability, owners equity, revenue, or expense, and state in each case whether the normal balance is a debit or a credit. a....
-
Explain the concept of mutuality of interest.
-
On April 23, 2014, Calvin Loyer admitted his wife, Edeltrud Loyer, to a nursing home administered by Signature Healthcare. During the admissions process, Calvin signed an arbitration agreement...
-
Fred Ridgeway has been given the responsibility of managing a training and development program. He knows the earliest start time, the latest start time, and the total costs for each activity. This...
-
The bar BC exerts a force on the cables at B that is directed along the line from C to B. (Figure 1) The mass of the suspended load is 190 kg. Suppose that = 20 and = 20. Part A What is the tension...
-
A circle with a radius 3 cm long is inscribed within a square (as shown below) Point A starts at the 3o'clock position and moves CCW along the circle Point B is fixed at the bottom-left corner of the...
-
sulty van and attenW Which pair of changes to the conditions of an ideal gas will always increase the internal energy of a fixed mass of the gas? PROT [1 mark] A 00 C D Gas pressure increase increase...
-
2. We have had a few major criminal cases locally that involve high profile individuals. These cases include the criminal trials of Whitey Bulger and Aaron Hernandez. Given the verdicts received and...
-
The Mortgage Payable account which relates to a long-term loan, decreased by $10,000 during the year as a result of principal payments. The company borrowed $5,000 by signing a short-term note...
-
A Map is a type of collection that associates a key with a value. The mapping of keys to values can be accomplished using different underlying data structures. In this three-part assignment, you will...
-
What standards do courts employ in judging the constitutionality of laws that are alleged to infringe "fundamental rights"? Explain the approach taken by courts in such cases.
-
Edison and Hermes are siblings; they each have an equal ownership interest in a residential rental property they inherited from their father. How do Edison and Hermes report the rental income and...
-
The demand and supply schedule for coffee are: Price ($ per cup) Quantity Demanded Quantity Supplied $1 130 10 $2 110 20 $3 90 30 $4 70 40 $5 50 50 $6 30 60 $7 10 70 $8 0 80 a) If there is no tax on...
-
What are the six activities involved in the physical supply/distribution system?
-
David and Elizabeth Kidds dog bit Mikaila Sherrod. Mikaila through her guardian ad litem (GAL) made a claim for damages. On June 14, 2005, the Kidds offered to settle the claim for $31,837. On July...
-
Explain the duty of care that is imposed upon (a) adults, (b) children, (c) persons with a physical disability, (d) persons with a mental deficiency, (e) persons with superior knowledge, and (f )...
-
Daniel Martin and John Duke contracted with J&S Distributors, Inc., to purchase a KIS Magnum Speed printer for $17,000. The parties agreed that Martin and Duke would send one half of the money as a...
-
State whether you think a business would recognise the following as an expense. When would it be recognised? a Depreciation $350 b Wages to be paid in the next month $1200 c Electricity bill due to...
-
What is the difference between operating expenses and non-operating expenses. Give examples of each.
-
What is the link between the income statement and the statement of owners equity?
Study smarter with the SolutionInn App