Reference no: EM13497511

Henry is a plasterer. He uses his own car (engine capacity 2600cc) to travel to the premises where he works. He acquired the car on 1 October 2010 for 60,000. The acquisition cost was funded entirely by a loan at an interest rate of 15%. He has determined that the depreciation on the car would be $2,300 for the year. In addition, Henry incurred the following expenses during the year:

• Registration and insurance = $2,000;
• Repairs and maintenance = $1,000 and
• Oil and fuel costs = $1,500.

For the period 1 October 2010 to 30 June 2011, Henry estimates that the car travelled a total of 15,000 kilometres, 12,000 of which were for business purposes. You may assume that Henry has maintained all necessary records and a logbook.

Calculate Henry's deduction for car expenses under each of the four methods in Div 28 of ITAA 1997. Use the "cents per kilometer" amounts for the 2009-10 year in answering this question. At the time of writing, reg 28-25.01 had not been updated for the 2010-11 year.