Question

1. Which of the following are not trading stock?

1. ☐ Bees kept for use in a honey production business        

2. ☐ Horses used in a city horse carriage tour business

3. ☐ Undeveloped land owned by a land developer

4. ☐ Partly finished computers of a computer manufacturer

2. For the purposes of the Goods and Services Tax (GST), when a registered business makes an input taxed supply it means that:

1. ☐ It is liable for GST on the supply, but it is not entitled to an input tax credit on GST paid on its business inputs affecting that supply

2. ☐ It is liable for GST on the supply, and is entitled to an input tax credit on GST paid on its business inputs affecting that supply

3. ☐ It is not liable for GST on the supply, and is entitled to an input tax credit on GST paid on its business inputs affecting that supply

4. ☐ It is not liable for GST on the supply, and is not entitled to an input tax credit on GST paid on its business inputs affecting that supply

Answer 1

Answer

Q.No.1 Horse used in a city horse carriage tour business

Horse carriage tour business are earn income through hiring or renting hence cannot treated as a trading stock.

Those other options are: bee used production,land is a input used in the process of manufacturing and  computers are in work in progress stage.

Q.No.2. It is not liable for GST on the supply, and is not entitled to an input tax credit on GST paid on its business inputs affecting that supply.

Input taxed supply means ,the supply that seller cannot charge GST on the supply and cannot claim Input tax credit in relation to that supply