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fgiga [73]
2 years ago
9

Gloria works as a freelance software developer with Ticki-Tacker Limited, a social media firm based in the city of London. She h

as two options for the purpose of personal income tax assessment. She may be added to the payroll of Ticki-Tacker Limited under the PAYE system or allowed to be treated as a self-employed individual. OPTION 1: Gloria under the PAYE system She will be placed on an annual salary of £50,000, and she would be required travel to work from Mondays to Fridays throughout the year via train, except for four weeks in a year when she will be on annual leave. The annual train ticket costs £2,400. OPTION 2: Gloria as a self-employed Gloria is allowed to invoice Ticki-Tacker Limited, an annual fee of £50,000. This work involves travelling to clients’ offices for a total of 5,200 miles annually in her own car. This is estimated to cost 39p/mile. Assume that Gloria’s annual accounts cover April 2020 to March 2021. REQUIRED: a. Calculate the relevant income tax and National Insurance Contribution liability under each of the two options identified. b. Calculate the disposable income (after all deductions) under the two options identified. c. Apart from (a) and (b) above, analyse any other factors that you think Gloria may take into consideration (from a taxation perspective) in arriving at the best option.
Business
1 answer:
Tanya [424]2 years ago
5 0

a. The relevant income tax and National Insurance Contribution liability are as follows:

                                                     PAYE System   Self-Employed

Income tax (20%)                             (£8,378)                £8,731

National Insurance Contribution      (5,712)                (4,317)

Total income tax and NIC liability  £14,090             £13,048

b. The disposable income after all known deductions under the two options are:

                                                  PAYE System   Self-Employed

Disposable income                       £33,510             £34,924

c. The other allowable deductions will need to be taken into consideration so that Gloria can arrive at the best option.

Data and Calculations:

                                                    PAYE System   Self-Employed

Earnings per year                            £50,000          £50,000

Allowable expenses:

Travel expenses                                (2,400)              (2,028) (£0.39 x 5,200)

Net Earnings                                   £47,600             £47,972

National Insurance Contribution     (5,712)               (4,317)

                                                (£47,600 x 12%)       (£47,972 x 9%)

Taxable income                              £41,888             £43,655

Income tax (20%)                            (£8,378)               £8,731

Disposable income                        £33,510             £34,924

Learn more: brainly.com/question/14531658

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Rodriguez Company pays $310,000 for real estate plus $16,430 in closing costs. The real estate consists of land appraised at $21
Sergeeva-Olga [200]

Answer:

Required 1.

Land =  $163,215

Land improvements = $65,286

Buildings =  $97,929

Required 2.

Land  $163,215 (debit)

Land improvements $65,286 (credit)

Buildings $97,929 (credit)

Cash $310,000 (credit)

Explanation:

Allocation of the purchase cost must be made on the bases appraisal value.

Total Appraisal Value =  $215,000 + $86,000 + $129,000

                                    =  $430,000

Land = $215,000 /  $430,000 × $326,430

        = $163,215

Land improvements =  $86,000 / $430,000 × $326,430

                                 = $65,286

Buildings = $129,000 / $430,000 × $326,430

                = $97,929

6 0
3 years ago
A competitive firm maximizes profit by choosing the quantity at which.
photoshop1234 [79]

Profit maximization can be achieved by a competitive corporation by choosing a quantity of output such that marginal revenue equals marginal cost.

<h3>How does a corporation maximize its profit?</h3>

A corporation maximizes income via way of means of operating wherein marginal revenue equals marginal price. The corporation chooses quantity in order for that rate to equal marginal value so that it can maximize its profit.

Therefore, When the marginal revenue for an aggressive corporation equals the market rate, the firm maximizes its profit.

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1 year ago
How long will it take for a $4000 investment to grow to $6000 at an annual rate of 15%, compounded monthly? Assume that no withd
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Answer:

It will take 2.72 years and 32.64 months.

Explanation:

Future value is the sum of principal amount and compounded interest amount invested on a specific rate for a specific period of time.

Use following formula to calculate the time period.

FV = PV x ( 1+ r )^n

FV = Future value = $6,000

PV = Present Value =  $4,000

r = rate of interest = 15% yearly = 15% / 12 = 1.25%

n = time period = ?

$6,000 = $4,000 x ( 1 + 1.25% )^n

$6,000 = $4,000 x ( 1.0125 )^n

$6,000 / $4,000 = ( 1.0125 )^n

1.5 = ( 1.0125 )^n

Log 1.5 = n log 1.0125

n = Log 1.5 / log 1.0125

n = 32.64 months

n = 2.72 years

6 0
3 years ago
The statement of cash flows presents:
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Answer:

Option C is correct.

Explanation:

The statement of cash flow presents us the information about the cash, where the cash was invested including how much cash we have earned by investing in projects, how much cash the operations has created and how much cash has been created from the financing activities. This statement tells us about the origin of the cash and where the company is spending it.

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If you found that the total of the debits column of the trial balance for a company is $200,000, while the total of the credits
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Some accounting errors that cause the difference between the debits and credits columns of the trial balance are as follows:

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  • Errors of commission
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  • Compensating errors
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  • Errors of principle
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These errors are called accounting discrepancies. They are not intentional mistakes, but they often occur.

Thus, to forestall accounting errors, every company requires good accounting software to record its transactions, while the accounting staff should be adequately trained.

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