Page 29 - Test 1 Slides - 4. Gross Income

GROSS INCOME

Excluding receipts of a capital nature

Solution:

9. Capital.

10. Revenue. Intention for quick resale is revenue

11. Capital. Realising asset to best advantage. Did not cross the Rubicon (Stott case,
Berea West case)

12. Revenue. Laying of sewerage and electricity supply meant that company had
crossed the Rubicon and had changed intention from capital (land owner) to revenue
(land developer) intention (Natal Estates case)

13. Capital. Compensation hole being filled is for a capital item

14. Revenue. Compensation hole being filled is a scheme of profit making

15. Revenue for the stock. Compensation hole being filled is a scheme of profit making.
Capital for the warehouse. Compensation hole being filled is for a capital item.

16. Revenue. Gamblers involved in a scheme of profit making when gambling

17. Revenue. Systematic gambling indicates revenue intent

18. Revenue. Trading stock retains its revenue identity

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