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Question - On 1 July 2020, RMKO Mechanical Pty Ltd purchased a pick-up truck at a cost of $60,000 for daily use in its business. The truck had an estimated effective life of four (4) years and was depreciating using the prime cost method. The pick-up truck was used 100% for business purposes. It was sold by the company on 30 April 2022 for $35,000.
Required -
1) Advise RMKO Mechanical Pty Ltd about what deductions (if any) it could claim for the truck for the 2021-2022 income tax year.
2) Advise RMKO Mechanical Pty Ltd the potential impact of the disposal of the truck on its assessable income for the 2021-2022 income tax year.
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