Assessment Title: BAS and Supporting Work Papers
ASSIGNMENT INFORMATION
Private College is a relatively new private school that is registered for GST. It has been operating since the beginning of the 2017 school year and at this stage just caters for students in Years 7 and 8 (the first two years of secondary school). During the month of June2018, they reported the following transactions:
Receipts (inclusive of GST where appropriate): $
- School fees 208,000
- Canteen income 6,640
- Government grants 46,312
- Year 8 Camp fees* 39,000
- Laptop hire fees 6,500
- Admission fees charged for drama and music performances by students 1,000
- Hire fees received from the local football club using the school's Sporting fields and canteen for training and game days 1,400
Expenses (inclusive of GST where appropriate):
- Electricity 8,642
- Year 8 camp expenses** 40,500
- Computer software licences 1,046
- Canteen expenses 2,070
- Insurance 28,111
- Contract Cleaner (not registered for GST) 1,200
- Interest on loans for school premises and equipment 7,667
- Rates 3,645
- First Aid Courses for staff members 600
- New Lawn Mower for school grounds 4,250
- Fuel 1,340
- Staff social club expenses*** 370
- Stationery & office supplies 640
- Subject expenses 2,434
- Costs for drama and music performances by students 874
- Salaries and wages (per information below)
*The fees charged for the compulsory Year 8 camp include a food component, camp activities component and bus travel to and from the camp. Of the total $39,000 the food component was $13,000.
**The expenses for the Year 8 camp include $3,250 for the bus, $13,500 for food and $23,750 for camp accommodation and activities for the students and accompanying teachers.
***Staff social club expenses include the cost of drinks and finger food on the last Friday of the month. These would not normally be deductible, due to the operation of s 32-5 ITAA97.
Salaries & Wages:
Private College pays all employees weekly. All employees are entitled to the tax-free threshold.
The permanent staff include teaching staff, clerical staff and grounds maintenance staff, who all work the same number of hours each week. Their weekly pay is based on an annual salary. Annual salaries are:
- Teaching staff total - $604,800 (9 teachers at same level, qualifications)
- Clerical staff total - $87,152 (2 clerical staff at same level, qualifications)
- Grounds maintenance staff total - $83,200 (2 staff at same level, qualifications)
The following casual employees were employed during the month to cover classes for the permanent teaching staff who were attending professional development and the Year 8 camp. Their weekly wages are based on the hours they work as set out in the table below:
|
Employee/Week
|
Ally $64/hour
|
Dean $60/hour
|
Michelle $58/hour
|
|
Week 1
|
0
|
10
|
0
|
|
Week 2
|
12
|
15
|
0
|
|
Week 3
|
8
|
0
|
0
|
|
Week 4
|
10
|
0
|
7
|
Other information relevant to Business Activity Statement (BAS):
The school has elected to prepare the BAS on a monthly basis.
A fuel tax credit of $150 has been claimed for the fuel used by mowers and other equipment in maintaining the school grounds. An FBT (Fringe Benefits Tax) instalment of $1,050 is due for the June quarter, but the school has decided not to provided fringe benefits anymore.
There are no liabilities for WET or LCT and no PAYG instalments due.
REQUIRED: Prepare the work papers necessary to evidence/support the Business Activity Statement you need to complete for the month. You should complete them as follows;
a) Prepare a schedule of wages paid for the month by weekly pay period, included PAYG withholding deductions and net wages for each category of employees.
b) Calculate the Superannuation payable for each category of employees for the month.
c) Discuss what a taxable supply is. Classify each receipt item listed, by the type of GST supply, explaining briefly why you have classified it that way. Calculate the amount of GST (if any) included in the price of each.
d) Discuss what conditions need to be met before Private College can claim input tax credits in relation to the expenses listed. Explain whether each of the acquisitions is a creditable acquisition. Calculate the amount of GST (if any) included in the cost.
e) Prepare a Business Activity Statement for the month ended 30 June2018, ensuring you complete all relevant labels.
Show all calculations and support all answers with references to legislation, case law and/or rulings.
Attachment:- Assignment Files.rar