Question 7 (14 marks in total) Calculate the maximum amount of allowable deduction, if any, available to the taxpayer in respect of each of the above expendi- tures for the year ended 30 June 2020. (6 marks) a. Minor Pty Ltd is a large resident manufacturing business that is not an eligible Small Business Taxpayer. The taxpayer has operated their business from the same premises for five years. During the 2020 year the taxpayer incurred the following pay- ments. All amounts are exclusive of GST and relate solely to the business: b. Peewee Power is a resident Small Business Taxpayer. Details from their plant and equipment records showed: 31 July 2019 $2,500 loan application fee in respect of a three-year business loan. Funds were applied to capital improvements. 15 Sept 2019 $160,000 extension to machine section of the factory building. 1/7/19 Opening balance of pool $42,000 31/9/19 Purchased new car (effective life 8 years) Estimated business use 80% $64,000 31/12/19 Purchased Desk (effective life 10 years) $950 31/01/20 Purchased machine (effective life 5 years) $60,000 31/04/20 Sold machine $10,000 31 January 2020 $15,000 Grease filter to reduce harmful oil discharge in wastewater from the factory. Effec- tive life 8 years. 31 January 2020 $7,500 replacing broken skylights and win- dows. New items will have an effective life of 10 years. All assets other than the car are used 100% for business purposes. The machine sold was purchased on 1 July 2016 for $20,000 and had an effective life of 5 years. All amounts are exclusive of GST. 31 March 2020 $75,000 purchase of new drilling machine. Effective life 6 years. Question 7 (Cont.) 1 June 2020 $24,000 payment in advance for a two-year maintenance contract commencing 1 June 2020. Required Required i. Calculate the maximum income tax deduction the taxpayer would be able to claim in the 2020 year in respect of the above plant and equipment. (4 marks) ii. Calculate the closing value of the general pool at 30 June 2020. (4 marks)