Practice Assessment 2 Question 1.9
Sentinel
Registered Posts: 9 New contributor 🐸
in Personal Tax
Hi, im confused on how to get the answer for this question. I used the restricted method (5/3 x (proceeds - 6000), but the answer is still wrong.
0
Comments
-
You calculate the gain as normal, but it cannot exceed the 5/3 method:
Painting £4,000 + Auctioneers Fees £80 (£4,000 x 2%) + Restorers Fees £500 = £4,580
£8,500 - £4,580 = £3,920
Using the 5/3 method it would be £8,500 - £6,000 = (2,500 / 3 ) x 5 = £4,167
As the gain doesn't exceed the 5/3 method, you go with the amount using the normal method.1 -
thank youskandwm15 said:You calculate the gain as normal, but it cannot exceed the 5/3 method:
Painting £4,000 + Auctioneers Fees £80 (£4,000 x 2%) + Restorers Fees £500 = £4,580
£8,500 - £4,580 = £3,920
Using the 5/3 method it would be £8,500 - £6,000 = (2,500 / 3 ) x 5 = £4,167
As the gain doesn't exceed the 5/3 method, you go with the amount using the normal method.0
Categories
- All Categories
- 1.2K Books to buy and sell
- 2.3K General discussion
- 18.9K For AAT students
- 259 NEW! Qualifications 2022
- 146 General Qualifications 2022 discussion
- 9 AAT Level 2 Certificate in Accounting
- 37 AAT Level 3 Diploma in Accounting
- 64 AAT Level 4 Diploma in Professional Accounting
- 8.9K For accounting professionals
- 23 coronavirus (Covid-19)
- 274 VAT
- 92 Software
- 274 Tax
- 137 Bookkeeping
- 7.3K General accounting discussion
- 193 AAT member discussion
- 3.8K For everyone
- 38 AAT news and announcements
- 352 Feedback for AAT
- 2.8K Chat and off-topic discussion
- 590 Job postings
- 17 Who can benefit from AAT?
- 36 Where can AAT take me?
- 44 Getting started with AAT
- 26 Finding an AAT training provider
- 48 Distance learning and other ways to study AAT
- 25 Apprenticeships
- 65 AAT membership