TAX2601 ASSIGNMENT 5 SEMESTER 2 - 2023 CLOSING DATE: 16 OCTOBER 2023 REQUIRED: a. List the questions you must ask the accountant about Asset UC1, to gather the necessary information to calculate the missing capital allowance. b. Explain to the accountant what errors exist with the R180 000 capital allowance calculation for the current year of assessment of Asset UC2 and why. Also explain how to correct each error. No calculation is required in your answer – marks will be allocated for explanations only. c. Calculate the capital allowance (if any), relating to the moving costs incurred to move asset UC3. d. Calculate the correct wear & tear allowance for the current year of assessment and any other tax consequences arising from the scrapping of the truck. Ensure you use brackets to indicate amounts that must be deducted and no brackets for amounts that must be added in the taxable income calculation. Note: UC informs you that non-manufacturing assets are written off using the binding general ruling no.7, which allows three (3) years for heavy-duty trucks. e. Calculate the capital allowances relating to Factory FF1 & FF2 for the current year of assessment and any other tax consequences arising from the sale of Factory FF1. Ensure you use brackets to indicate amounts that must be deducted and no brackets for amounts that must be added in the taxable income calculation.
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