Congratulations on your appointment as a Tax Trainee at a recognized audit firm in Jamaica. On your first assignment your supervisor asked you to assist him with the income tax computation of a small business in the tourism sector. The company provided the following information: Allen's Rest Well Resort is a resort cottage located incorporated in Jamaica. The company is a registered tourism operator under the Tourist Board Act. The hotel commenced operations on the 1 January 2019. Fixed Assets Cost (J$) TWDV (J$) Building (hotel) Furnitures Computers (laptops and CPUS) Computers (printers and monitors) 100,000,000 8,000,000 1,000,000 500,000 72,000,000 6,000,000 500,000 375,000 Motor Cars # 1 purchased in July 2019 3,000,000 2,437,500 # 2 purchased January 2019 Bus and Vans (purchased 1 January 2019) 2,500,000 8,00,0000 1,875,000 480,000 The following acquisitions and disposal occurred in 2021: 1. A Corolla motor car purchased for $3,000,000. Acquired 1 April 2021. 2. A BMW for $10,000,000. Acquired 1 November 2021. 3. A new building constructed for $30,000,000 4. Laptop for $100,000 5. Purchase of a telephones for $950,000. 6. The company Motor car #1 was sold for $2,700,000 Assume the relevant exchange Rate is US$152: J$1 Required Calculate the capital allowance computation for Allen's Rest Well Resort for 2021.
Congratulations on your appointment as a Tax Trainee at a recognized audit firm in Jamaica. On your first assignment your supervisor asked you to assist him with the income tax computation of a small business in the tourism sector. The company provided the following information: Allen's Rest Well Resort is a resort cottage located incorporated in Jamaica. The company is a registered tourism operator under the Tourist Board Act. The hotel commenced operations on the 1 January 2019. Fixed Assets Cost (J$) TWDV (J$) Building (hotel) Furnitures Computers (laptops and CPUS) Computers (printers and monitors) 100,000,000 8,000,000 1,000,000 500,000 72,000,000 6,000,000 500,000 375,000 Motor Cars # 1 purchased in July 2019 3,000,000 2,437,500 # 2 purchased January 2019 Bus and Vans (purchased 1 January 2019) 2,500,000 8,00,0000 1,875,000 480,000 The following acquisitions and disposal occurred in 2021: 1. A Corolla motor car purchased for $3,000,000. Acquired 1 April 2021. 2. A BMW for $10,000,000. Acquired 1 November 2021. 3. A new building constructed for $30,000,000 4. Laptop for $100,000 5. Purchase of a telephones for $950,000. 6. The company Motor car #1 was sold for $2,700,000 Assume the relevant exchange Rate is US$152: J$1 Required Calculate the capital allowance computation for Allen's Rest Well Resort for 2021.
Chapter15: Choice Of Business Entity—other Considerations
Section: Chapter Questions
Problem 95EDC
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Transcribed Image Text:Congratulations on your appointment as a Tax Trainee at a recognized audit firm in
Jamaica. On your first assignment your supervisor asked you to assist him with the
income tax computation of a small business in the tourism sector. The company
provided the following information:
Allen's Rest Well Resort is a resort cottage located incorporated in Jamaica. The
company is a registered tourism operator under the Tourist Board Act. The hotel
commenced operations on the 1 January 2019.
Fixed Assets
Cost (J$)
TWDV (J$)
Building (hotel)
Furnitures
Computers (laptops and CPUS)
Computers (printers and monitors)
100,000,000
8,000,000
1,000,000
500,000
72,000,000
6,000,000
500,000
375,000
Motor Cars
# 1 purchased in July 2019
3,000,000
2,437,500
# 2 purchased January 2019
Bus and Vans (purchased 1 January 2019)
2,500,000
8,00,0000
1,875,000
480,000
The following acquisitions and disposal occurred in 2021:
1. A Corolla motor car purchased for $3,000,000. Acquired 1 April 2021.
2. A BMW for $10,000,000. Acquired 1 November 2021.
3. A new building constructed for $30,000,000
4. Laptop for $100,000
5. Purchase of a telephones for $950,000.
6. The company Motor car #1 was sold for $2,700,000
Assume the relevant exchange Rate is US$152: J$1
Required
Calculate the capital allowance computation for Allen's Rest Well Resort for 2021.
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