Assignment title: Information

Question 1 (5 Marks)Hilary is a well-known mountain climber. The Daily Terrornewspaper offers her $10,000 for her life story, if she will write it.Without the assistance of a ghost writer, she writes a story andassigns all her right, title and interest in the copyright for $10,000to the Daily Terror. The story is published and she is paid. She hasnever written a story before. She also sells the manuscript to theMitchell Library for $5,000 and several photographs that she tookwhile mountain climbing for which she receives $2,000.Requirement:Discuss whether or not the three payments are income frompersonal exertion. Would your answer differ if she wrote thestory for her own satisfaction and only decided to sell it later?Question 2 (5 marks)Your client is a parent who lent $40,000 to her son to provide ashort-term housing loan. The agreement is that the son will repay$50,000 at the end of five years.Reconsider this question in light of the following facts. The loan wasmade to the son without any formal agreement and without anysecurity provided for the sum lent. In addition, the client (themother) has informed you that she told her son that he need notpay interest. However, the son repaid the full amount after twoyears and included in his payment an additional amount which wasequal to 5% pa on the amount borrowed. Only one cheque waspresented for the total amount.Requirement:Discuss the effect on the assessable income of the parent.Question 3 (10 Marks)Scott is an accountant who purchased a vacant block of land inBrisbane on 1 October 1980. On 1 September 1986, Scott built ahouse on the land. At the time, the land was valued at $90,000 andthe cost of construction was $60,000. The property has been rentedout since construction was completed. On 1 March of the current taxyear, Scott sold the property at auction for $800,000.Requirement:a) Based on the information above, determine Scott's netcapital gain or net capital loss for the year ended30 June of the current tax year.b) How would your answer to (a) differ if Scott sold theproperty to his daughter for $200,000?c) How would your answer to (a) differ if the owner of theproperty was a company instead of an individual