Dick sold off some of his assets during the financial year so he could buy a...
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Dick sold off some of his assets during the financial year so he could buy a new house for himself and his new wife Dora. A) Sale of vacant land on 28 May 2020 The land had been bought on 28 October 1984 at a cost of $95,000. Stamp duty of $2,358 was paid at purchase. Rates and taxes of $15000 were paid during ownership. He paid $10,000 to the agent for the sale of the land and $1299 in settlement fees, these were both paid on 28 May 2020. The land had been bought by Dick with the intention of building a factory for his business. 290,000 B) Sale of shares in public company on 23 September 2019 The shares had been bought on 3 March 2018 for $48,000 Brokerage on purchase and sale was 1% payable at the 55,000 time of the transaction. C) Sale of holiday house on 12 August 2019 The house had been purchased on 22 November 2005 for $290,000. He had paid interest during his period of ownership which totalled $40,000. Stamp Duty of $6,320 had been paid at purchase. At purchase He arranged to have a new kitchen fitted at a cost of $23,000. This was paid on 15 January 2006. During the period of ownership He had a dispute with his neighbour over the boundary of the property and on 1 March 2011 He paid his lawyer $2,500 for resolving the dispute. 400,000 Dick had a previous capital loss of $15,000 from the sale of shares in 2019. Required: Calculate the net capital gain or loss for Dick. Dick sold off some of his assets during the financial year so he could buy a new house for himself and his new wife Dora. A) Sale of vacant land on 28 May 2020 The land had been bought on 28 October 1984 at a cost of $95,000. Stamp duty of $2,358 was paid at purchase. Rates and taxes of $15000 were paid during ownership. He paid $10,000 to the agent for the sale of the land and $1299 in settlement fees, these were both paid on 28 May 2020. The land had been bought by Dick with the intention of building a factory for his business. 290,000 B) Sale of shares in public company on 23 September 2019 The shares had been bought on 3 March 2018 for $48,000 Brokerage on purchase and sale was 1% payable at the 55,000 time of the transaction. C) Sale of holiday house on 12 August 2019 The house had been purchased on 22 November 2005 for $290,000. He had paid interest during his period of ownership which totalled $40,000. Stamp Duty of $6,320 had been paid at purchase. At purchase He arranged to have a new kitchen fitted at a cost of $23,000. This was paid on 15 January 2006. During the period of ownership He had a dispute with his neighbour over the boundary of the property and on 1 March 2011 He paid his lawyer $2,500 for resolving the dispute. 400,000 Dick had a previous capital loss of $15,000 from the sale of shares in 2019. Required: Calculate the net capital gain or loss for Dick.
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ASale value of land 290000 Agents fees 10000 Settlement fees 1299 Net sale proceeds 278701 ... View the full answer
Related Book For
Foundations of Finance The Logic and Practice of Financial Management
ISBN: 978-0132994873
8th edition
Authors: Arthur J. Keown, John D. Martin, J. William Petty
Posted Date:
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