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Homework answers / question archive / Scorching Motors sells a fuel-efficient luxury car to Joel for an 'all up' price of $106500, including GST (10%) and Luxury Car Tax (33%)

Scorching Motors sells a fuel-efficient luxury car to Joel for an 'all up' price of $106500, including GST (10%) and Luxury Car Tax (33%)

Accounting

Scorching Motors sells a fuel-efficient luxury car to Joel for an 'all up' price of $106500, including GST (10%) and Luxury Car Tax (33%). This price does not include stamp duty, registration or compulsory third party insurance. 

Calculate:

1.  The LCT (using the  2018-19 threshold amount) 

2. The GST Scorching Motors must pay on this sale. 


 

(all answers to 2 decimal places)


 

Tip: If you cannot find the threshold for the 2018-19 financial year in your textbook, visit www.ato.gov.au and search for 'LCT threshold'. 
 

Required to calculate : 

 

LCT = 

 

Answer for part 1

 

 

 

 

GST = 

 

Answer for part 2

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To begin with, the Luxury Vehicle Tax is indeed a tax imposed on vehicles with a GST including purchase worth exceeding a certain level. The minimum price for the fuel-efficient automobile is $75526.00

 

 

Part 1

 

Calculate the LCT;

 -The LCT is valued at $106500.00

- The LCT value is above the threshold.= $106500 - $75526 = $30974.00

 -GST is included in the reversal of the LCT.= $30974 divided by 1.43 = $21660.14

- LCT is used at a rate of 33percent.= $21660.14*33percent = $7147.85

 

 

Part 2

-GST calculations;

-LCT is not included in the value= $106500.00 - $7147.85 = $99352.15

-GST monetary value= ($99352.15 divided by 1.10) * 10percent = $9032.01

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