Question: Part One: Equalization Calculation - 12 Marks This part contains one question. Show all of your steps and calculations. You must also provide explanations for

Part One: Equalization Calculation - 12 Marks This part contains one question. Show all of your steps and calculations. You must also provide explanations for decisions you make in the process of your calculations. Your answer should be in paragraph form. You should refer to legislation in support of your choices, where appropriate.

Gracia and Jorge married twelve years ago. They have just separated. Using the following facts: (a) Calculate the net family property of each spouse. (b) Calculate the equalization payment, and indicate who will be making it.

Jorges financial situation:

At the date of the marriage

He owned a house worth $300,000.00, with a $100,000.00 mortgage

He owned a boat worth $20,000.00 that had been gifted to him from his uncle

He had a bank account worth $30,000.00. He had inherited these funds from his aunt.

He owned a rental property worth $200,000.00. There was no mortgage on the property.

He owed $25,000.00 in student loans

During the marriage

He withdrew the 30,000.00 in savings and invested the money in Google shares

He purchased a painting done by a local artist for 25,000.00

At the date of separation

He continues to own the rental property, which is now worth $275,000.00.

He continues to reside in the house. He and Gracia lived in this house throughout the marriage. The house is now worth $450,000.00 and there is no mortgage on the house.

He still has the boat, which is now worth $10,000.00

He continues to own Google shares, now worth $40,000.00

He still owns the painting, now worth $50,000.00

He has $50,000.00 in savings

He owes $27,000.00 on his credit card

Gracias financial situation

At the date of the marriage

Gracia had $150,000.00 in a savings account.

She owned $10,000 in Yahoo shares

Gracia owed $25,000.00 on her Visa credit card

During the marriage

She purchased a cottage for $150,000.00, which the family stayed in during the summers and on several weekends throughout the year.

Gracia inherited $100,000.00, which she invested in the matrimonial home.

At the date of separation

Gracia continues to own the cottage, now worth $275,000.00.

She still owns the Yahoo shares, now worth $35,000.00

Gracia has savings in a bank account, now worth $40,000.00

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