TASK 4
Robert and Peter are father and son. Together they operate a business partnership providing
security services. Robert is aged 45. His son, Peter aged 20, works full-time in the partnership.
The partnership agreement states that all profits and losses will be shared equally after allowing wages to partners and interest on capital.
During the 2021/22 income year the partnership had the following transactions:
RECEIPTS
$609,000
50,000
Gross Fees
Business Loan from Robert
1,000
for
Gross Bank Interest
PAYMENTS
7,000
Interest on Overdraft
10,000
Interest on Loan from Robert
Lease of all Security Systems Equipment owned by Robert - Note 1
45,000
3,000
Interest on Capital - Robert
250,000
40,000
Wages to Employees
Wages to Robert
45,000
Wages to Peter
10,000
168,000
Superannuation paid for Employees Other overheads (deductible)
Note 1
Robert owns all the security equipment and leases all the equipment to the partnership. Robert is entitled to a deduction of $34,000 for decline in value of the equipment.
REQUIRED:
Using the template provided
Calculate Net Partnership Income
1.
Prepare a Partnership Distribution Statement
2.
Calculate Robert's Taxable Income
3.
4.
Calculate Peter's Taxable Income