Adam runs his own marketing business in Australia. During theyear he incurred the following...

60.1K

Verified Solution

Question

Accounting

Adam runs his own marketing business in Australia. During theyear he incurred the following expenses: a) salary costs of$500,000. b) salary costs of $9,000 for his son who did somegraphic design work for him as he was studying graphic design atuniversity. The work took approximately 19 hours to complete. c)$1200 on membership to the local bowls club where he entertainsclients. d) $3,000 on smart clothing that he considered necessaryto portray the correct image to his clients. e) $8,500 on mealexpenses for his important clients. f) Interest cost of $8,400 on aloan he took out to start up the business. g) $4,000 in travellingfrom home to work. h) $8,500 in telephone bills, of which heestimates 80% to be used for calling clients. i) $9,000 on airfareand accommodation to a marketing conference. j) $600 charged by hisaccountant to complete his tax return for the year. Advise Adam asto the deductibility of the above expenses. Ensure to makereference to relevant legislation

Answer & Explanation Solved by verified expert

4.5 Ratings (859 Votes)

Below are the deductible of the mentioned expenses a As per QC 33728 You can generally claim a deduction for salaries and wages you pay to your workers and for super contributions you make for them So in our case Adam can claim salary cost of 500000 as a deductible expenses b As mentioned above salary paid to his son is also deductible expense c Only those expenses are deductible which are directly related to See Answer

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member

Transcribed Image Text

In: AccountingAdam runs his own marketing business in Australia. During theyear he incurred the following expenses:...Adam runs his own marketing business in Australia. During theyear he incurred the following expenses: a) salary costs of$500,000. b) salary costs of $9,000 for his son who did somegraphic design work for him as he was studying graphic design atuniversity. The work took approximately 19 hours to complete. c)$1200 on membership to the local bowls club where he entertainsclients. d) $3,000 on smart clothing that he considered necessaryto portray the correct image to his clients. e) $8,500 on mealexpenses for his important clients. f) Interest cost of $8,400 on aloan he took out to start up the business. g) $4,000 in travellingfrom home to work. h) $8,500 in telephone bills, of which heestimates 80% to be used for calling clients. i) $9,000 on airfareand accommodation to a marketing conference. j) $600 charged by hisaccountant to complete his tax return for the year. Advise Adam asto the deductibility of the above expenses. Ensure to makereference to relevant legislation