n 2018 an asset was purchased for $2,000,000. The asset qualified for Initial Allowance. The Initial Allowance (I.A) Rate was 20%. Annual Allowance (A.A) Rate was 10%. The asset was sold in 2020 for $1,000,000. Capital allowance is on the reducing balance basis. The balancing adjustment is: a. A Balancing Allowance b. A Balancing Charge 2. Which of the following statements are NOT correct? i. A registered taxpayer can claim input tax credit for items used for its exempt activities. ii. A registered taxpayer can claim input tax credit for items used for zero-rated activities. iii. The VAT rate Exempt supplies is 0%. iv. Zero-rated goods or services are taxable for VAT at 0%. a. None of the above b. i only c. i, ii and iv d. i, and iii BDF limited as the following supplies: Supplies at standard rate $5,000,000 Supplies at Zero percent $3,000,00 Supplies at 25% $2,000,000 Exempt Supplies $5,000,000 The GCT threshold is $10,000,000. Which of the following statement is correct? a. BDF limited total supplies is $9,000,000 . The company is required to register for VAT. b. BDF limited taxable supplies is $7,000,000 . The company is not required to register for VAT. c. BDF limited taxable has exempt supplies . The company is not required to register for VAT. d. BDF limited total supplies is $15,000,000 . The company is required to register for VAT. Anti-avoidance provisions _________________. a. are provisions in the tax laws to prevent certain harmful tax avoidance practice. b. will eliminate all tax avoidance. c. will always prevent tax evasion. d. will eliminate tax planning by taxpayers.

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter8: Current And Contingent Liabilities

Section: Chapter Questions

Problem 2MCQ

Related questions

Question

n 2018 an asset was purchased for $2,000,000. The asset qualified for Initial Allowance. The Initial Allowance (I.A) Rate was 20%. Annual Allowance (A.A) Rate was 10%. The asset was sold in 2020 for $1,000,000. Capital allowance is on the reducing balance basis. The balancing adjustment is:

A Balancing Allowance

A Balancing Charge

2. Which of the following statements are NOT correct?

i. A registered taxpayer can claim input tax credit for items used for its exempt activities.

ii. A registered taxpayer can claim input tax credit for items used for zero-rated activities.

iii. The VAT rate Exempt supplies is 0%.

iv. Zero-rated goods or services are taxable for VAT at 0%.

None of the above

i only

i, ii and iv

i, and iii

Supplies at standard rate $5,000,000

Supplies at Zero percent $3,000,00

Supplies at 25% $2,000,000

Exempt Supplies $5,000,000

The GCT threshold is $10,000,000.

Which of the following statement is correct?

BDF limited total supplies is $9,000,000 . The company is required to register for VAT.

BDF limited taxable supplies is $7,000,000 . The company is not required to register for VAT.

BDF limited taxable has exempt supplies . The company is not required to register for VAT.

BDF limited total supplies is $15,000,000 . The company is required to register for VAT.

are provisions in the tax laws to prevent certain harmful tax avoidance practice.

will eliminate all tax avoidance.

will always prevent tax evasion.

will eliminate tax planning by taxpayers.

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