Question:can i have answer this question?
Ed’s grandmother died on 1 November 2005 and, in her will, left Ed cash and jewellery worth $500,000. The jewellery had been bought by Ed’s grandmother in August 1985 at a cost of $40,000, and its market value on 1 November 2005 was $150,000.
Ed used the money from his grandmother and his savings to buy the following assets in January 2006:
(a) an apartment in Melbourne (cost was $360,000 plus $20,000 legal fees and stamp duty),
(b) a rare painting (cost was $50,000), and
(c) 2,000 bank shares (cost was $20 per share, plus $200 brokerage).
In 2015/16, Ed disposed of these assets as follows:
(1) on 12 March 2016, he sold the apartment for $470,000 – he had lived in it all the time he owned it,
(2) on 1 April 2016, the painting was stolen from his apartment – he received $30,000 compensation from his insurance company,
(3) on 13 May 2016, Ed sold 1000 bank shares for $30 per share (brokerage cost $150), and
(4) on 15 June 2016, he lost the jewellery, which wasn’t insured, when he left his briefcase on a train.
Prepare a report advising Ed, that explains the CGT consequences of these transactions.
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