LEARNING
OUTCOMES:
The purpose of the assignment is to assess a student’s
ability to:
1. identify the facts available;
2. identify the taxation issues arising;
3. research the relevant law;
4. apply the law to the facts identified; and
5. form an opinion.
REQUIRED
Taking
the above Learning Outcomes into consideration, your assignment is to prepare a
written opinion addressed to your client, Water-Jet Ferries. It should be no
longer than 1,000 words.
ASSIGNMENT CASE- STUDY
WATERJET FERRIES
WaterJet Ferries is a
successful ferry operator providing roll-on/roll-off car and truck ferry
services to the larger islands off the coast using vessels that are propelled
by water-jets powered by diesel engines. Over the last twelve months the
company’s profitability has been badly affected by rising fuel costs and a fall
in patronage. As a consequence management has decided to examine the
possibility of modifying the existing engines to reduce their fuel consumption.
Not only would the modifications result in reduced fuel costs, the modified
engines would produce increased power permitting the vessels to travel at
higher speeds and so enable more services to be provided. A further benefit would
be that the modified engines would be environmentally friendlier which is
important to the island communities served by the company.
Their decision was arrived
at after receiving advice from the engine manufacturer that WaterJet would be
able to treat the modifications as a repair and by doing so claim a tax
deduction for the cost incurred.
WaterJet has requested your
company to provide them with an opinion as to the correctness of this claim by
the engine manufacturer. Your opinion must be supported by reference to any
applicable tax legislation and/or case law.
SCHOOL POLICIES
You should refer to the Subject Outline and carefully note the School’s policies in regard to the following matters:
1. the late submission of assignments;
2. the presentation of written work; and
3. academic integrity
ASSIGNMENT COVER SHEET
An Assignment Cover Sheet must be completed, signed and attached to the hard copy of your assignment prior to its submission. These forms are available at the Reception/Front Office. Please check the cover sheet for details relating to assignment requirements.
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