In April 2020, Mr Ching acquired a flat in Sai Ying Pun with finance obtained from...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
In April 2020, Mr Ching acquired a flat in Sai Ying Pun with finance obtained from a local bank. He signed a lease with the following terms with Ms Ma on 28 April 2020: (1) The lease runs from 1 May 2020 for two years. (2) Monthly rental: $36,000, payable in advance. (3) Initial premium: $60,000, payable on signing the lease agreement. Rental deposit: $65,000, payable on signing the lease agreement. As per the lease agreement, the rental deposit is to be used to compensate any loss of revenue when the tenant defaults in payment of the rent. Rates: $3,000 per quarter, payable by Mr Ching. Ms Ma asked for a rent-free period to facilitate a minor repair to the flat. Mr Ching agreed to give a half-month rent-free period from the date the lease started to take effect. The repair cost of $15,000 was paid by Ms Ma. Management fee: $2,000 per month, payable by Mr Ching. (5) (6) (7) Additional information: (1) During the year ended 31 March 2021, Mr Ching incurred bank mortgage interest of $120,000. A property agency fee for letting the property, equivalent to half of the monthly rental, was also paid on 25 April 2020. (2) Since 1 January 2021, Mr Ching has not received any rental payments from Ms Ma. On 16 May 2021, Mr Ching was advised by the management company that Ms Ma had moved out without leaving any contact details. The property was left vacant until it was sold on 31 August 2021. Required: (i) Compute the property tax payable by Mr Ching (if any) for each of the years of assessment 2020/21 and 2021/22 using the most favourable method. (13 marks) (ii) This question is independent of requirement (i). Assume the property tax for the year of assessment 2020/21 has become final and conclusive. Advise Mr Ching (Client 1) the course of action that he can take in order to re-open a final and conclusive assessment. (7 marks) In April 2020, Mr Ching acquired a flat in Sai Ying Pun with finance obtained from a local bank. He signed a lease with the following terms with Ms Ma on 28 April 2020: (1) The lease runs from 1 May 2020 for two years. (2) Monthly rental: $36,000, payable in advance. (3) Initial premium: $60,000, payable on signing the lease agreement. Rental deposit: $65,000, payable on signing the lease agreement. As per the lease agreement, the rental deposit is to be used to compensate any loss of revenue when the tenant defaults in payment of the rent. Rates: $3,000 per quarter, payable by Mr Ching. Ms Ma asked for a rent-free period to facilitate a minor repair to the flat. Mr Ching agreed to give a half-month rent-free period from the date the lease started to take effect. The repair cost of $15,000 was paid by Ms Ma. Management fee: $2,000 per month, payable by Mr Ching. (5) (6) (7) Additional information: (1) During the year ended 31 March 2021, Mr Ching incurred bank mortgage interest of $120,000. A property agency fee for letting the property, equivalent to half of the monthly rental, was also paid on 25 April 2020. (2) Since 1 January 2021, Mr Ching has not received any rental payments from Ms Ma. On 16 May 2021, Mr Ching was advised by the management company that Ms Ma had moved out without leaving any contact details. The property was left vacant until it was sold on 31 August 2021. Required: (i) Compute the property tax payable by Mr Ching (if any) for each of the years of assessment 2020/21 and 2021/22 using the most favourable method. (13 marks) (ii) This question is independent of requirement (i). Assume the property tax for the year of assessment 2020/21 has become final and conclusive. Advise Mr Ching (Client 1) the course of action that he can take in order to re-open a final and conclusive assessment. (7 marks)
Expert Answer:
Answer rating: 100% (QA)
Question1 Property tax payable by Mr Ching for the year of assessment 202021 Rates 3000 per quarter ... View the full answer
Related Book For
College Accounting A Contemporary Approach
ISBN: 978-0073396958
2nd edition
Authors: David Haddock, John Price, Michael Farina
Posted Date:
Students also viewed these finance questions
-
A 15-mm-diameter steel bar is to be used as a torsion spring. If the torsional stress in the bar is not to exceed 110 MPa when one end is twisted through an angle of 30, what must be the length of...
-
A thin-wall stainless-steel tube is to be used as an electric heating element that will deliver a convection coefficient of 5000 W/m2 C to water at 100C. Devise several configurations to accomplish...
-
The spring in Prob. 103 is to be used with a static load of 30 lbf. Perform a design assessment represented by Eqs. (1013) and (1018) through (1021) if the spring is closed to solid height.
-
An analog filter is defined by its transfer function: 100n H(s) = %3D s+ 100n What type of filter H(s) is? A. Low-pass B. High-pass C. Band-pass D. Band-stop
-
A subsidiary sold an old, abandoned plant to its parent and incurred a loss of $10 million. Can this loss be reported on the subsidiary-only income statement as an extraordinary item?
-
Describe the main problems and issues connected to the state unemployment compensation program.
-
A randomized-block experiment is run with three treatments and four blocks. The three treatment means are \(\bar{y}_{1}=6, \bar{y}_{2 \bullet}=7\), and \(\bar{y}_{3 \bullet}=11\). The total...
-
If a 6%, 10-year, $800,000 bond is issued at face and interest is paid annually, what is the amount of the interest payment at the end of the first period?
-
When monochromatic light of an unknown wavelength falls on a sample of copper, a minimum potential of 2.49 V is required to stop all of the ejected photoelectrons. (The work function for copper is...
-
Saratoga Ltd. was having difculty in raising nance for expansion. Kingsh Ltd. was interested in achieving economies by marketing a wider range of products. The following shows the nancial positions...
-
Mr. Jim Rosario, a financial adviser, is planning to make an investment portfolio for his client. He is currently looking at three possible portfolio combination. Listed below are the three options...
-
Prove Jensen's inequality for discrete random variables via induction as follows. For a convex function \(f\) : (a) Let a random variable \(X\) take on two values \(x_{1}
-
Access to adequate food is the primary concern for most countries; thus, agriculture is one of the most important industries in the world. The security and health of population has lowered the price...
-
From the following information determine the total 2018 tax due for Charlene and Dick Storm, assuming they file a joint return, have three dependents, and are not members of a qualified retirement...
-
The Netherlands primarily exports agricultural products, while importing raw materials such as natural gas, metal ores, and grains. Analyze the impact of the following events on the Netherlands terms...
-
Hariet Hemingway, CPA, has identified an opportunity to use data analytics in her audit program. She remembers from a recent team training session that the data should be relevant and reliable but...
-
Professor Snape won $10,000 as a "Educator of the Year", selected in a contest that he did not enter. He is not required to provide any additional services as a condition to receiving the award. The...
-
What types of questions can be answered by analyzing financial statements?
-
Sadie Palmer owns Palmer Creative Designs. The trial balance of the firm for January 31, 2013, the first month of operations, is shown on the bottom of page 146. INSTRUCTIONS 1. Complete the...
-
At the beginning of September, Alexander Parker started Parker Investment Services, a firm that offers advice about investing and managing money. On September 30, the accounting records of the...
-
Best Sounds is a wholesale business that sells musical instruments. Transactions involving sales and cash receipts for the firm during April 2013 follow. The firm sells its merchandise for cash and...
-
Analyze the last poor decision made by a group of which you were a member. What do you think contributed to the groups poor decision? Did the group think of alternative possibilities? Did the group...
-
Explain why teams and groups are not the same.
-
Discuss the various task groups within an organization and their purposes.
Study smarter with the SolutionInn App