Because Bread Boy Bakery Ltd needed to increase its oven capacity, it ordered a new $100,000 oven on 15 March 2020 The oven was delivered on 1 May 2020 Bread Boy received a $16,000 trade in on the old oven which had an adjustable value of $12,000 The cost of removing the old oven was $4,800, and the cost of installing the new oven was $10,000 (comprising $7,000 for strengthening the floor and $3,000 for special wiring for the increased electrical power needed) The new oven was first used on 15 May 2020 The Commissioner estimates bakery ovens to have an effective life of 15 years Required Advise Bread Boy Bakery on what deductions (if any) may be claimed for the tax year ended 30 June 2020

Question: Because Bread Boy Bakery Ltd needed to increase its oven capacity, it ordered a new $100,000 oven on 15 March 2020. The oven was delivered

Because Bread Boy Bakery Ltd needed to increase its oven capacity, it ordered a new $100,000 oven on 15 March 2020. The oven was delivered on 1 May 2020.

Bread Boy received a $16,000 trade-in on the old oven which had an adjustable value of $12,000.
The cost of removing the old oven was $4,800, and the cost of installing the new oven was $10,000 (comprising $7,000 for strengthening the floor and $3,000 for special wiring for the increased electrical power needed).
The new oven was first used on 15 May 2020.
The Commissioner estimates bakery ovens to have an effective life of 15 years.

Required

Advise Bread Boy Bakery on what deductions (if any) may be claimed for the tax year ended 30 June 2020.

Step by Step Solution

★★★★★

3.48 Rating (161 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

In the given case The new maehine costing 4 cost of in stalliy the machine 00000 10000 Tota... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

For the year ended 30 June 2018, the business income and expenses for APC Restaurant are shown in the following Profit & Loss Statement that was prepared under cash basis: Peter also provides you...

In the Household Expenditure Statistics: Year Ended 30 June 2016 (Statistics New Zealand, , licensed by Statistics New Zealand for re-use under the Creative Commons Attribution 3.0 New Zealand...

The draft accounts for the year ended 30 June 2016 and a balance sheet as at that date for S. Steiner are submitted to you. Towards the end of the financial year her accountant resigned and she had...

Iron Chicken (IC) is a multinational business which manufactures commercial building control systems. Building control systems include heating and air-conditioning systems, lighting controls, power...

Below are two balance sheets for Cameron's Cleaning plus information concerning net profit? Net profit was $100 000 for the year, sales $370 000, interest paid $15 000, salaries $19 000, depreciation...

Long Weekend Ltd suffered a severe drop in sales and profit performance for the year ended 30 June 2015. The income statement revealed that net sales were $1500000 with a profit of $310000. Unit...

Hampton Housing Ltd (HHL) is a land development company trading in the construction of residential house and land packages in Sydneys western suburbs. The company is currently developing a...

The information overleaf relates to Cascade Ltd. Additional information in relation to the year ended 30 June 2018 (a) A loan payable of $45000 was satisfied by conversion into 45 000 ordinary...

ChemCo International Ltd manufactures specialty chemicals, vehicle airbags and salt. Recently, its specialty chemicals business was reorganised, and three manufacturing plants were closed. Profits...

The following financial statements were prepared for the management of Back2Basics Ltd. The statements contain some information that will be disclosed in note form in the general purpose financial...

11. An induction motor rotating at 3560 RPM exhibits vibration at 1, 2, and 3 orders. Components of the machine have natural frequencies at 400 CPM, 3800 CPM, and 9700 CPM. For diagnostics purposes,...

An ABDE metal pipe is kept in balance by a DF cable as well as by two ball joints in A and E. A load of 800N (vertical) is applied in C. a) What is the moment of force associated with the load of 800...

Q1. Gourmet has PKR150 million in sales revenue with PKR90 million in cost of goods sold. It has selling and administrative expenses of PKR10, pays annual taxes in the amount of PKR10 and has...

Imagine you head a large agency such as the Department of Education (DoE). Based on your experience with the CITI certification process and your class readings, outline a protocol for approving...

Using the P-O-L-C Framework, answer the following questios: 600 wrds.. Take one item from each section that you could relate to you and discuss how you could use in your life right now.and write the...

Fig. H 4.39 Determine the forces bars 1, 2 and 3 of the plane truss loaded and supported (Ans. S S2 S3=-30 a/2h) as shown in Fig. I. = C aaaaaa B aga Fig. 1 Q

Fred Corp is considering a project that has the following cash flow data. What is the project's IRR? Not the a project's projected IRR can be less than the WACC or negative, in both cases it will be...

At the beginning of its fiscal year, Lakeside Inc. leased office space to LTT Corporation under a seven-year operating lease agreement. The contract calls for quarterly rent payments of $25,000 each....

Bart and Homer are two engineers who work in the quality control lab at Schneider's Pretzel Co. in Handover Germany. Their job is to make sure all of the pretzels are made to a consistent size....

The following machine-incident matrix has been prepared for a manufacturing plant that produces seven parts on six machines. Use the PFA group technology technique to cluster the seven parts in...

A design of experiment was conducted on the process described in problem 8-17. Some process improvements were made and the following data were collected. c. What is your estimate of the process...

What is S2 in (7.3) for an SRS? How does it compare with the sample variance s2?

Consider a probability sample S of n observation units from a population U of N observation units. The weights are wi =1/i, where i is the probability that unit I is in the sample. Now let S2 be a...

Gnap (1995) conducted a survey on teacher workload which was used in Exercise 15 of Chapter 5. a. The original survey was intended as a one-stage cluster sample. What was the overall response rate?...