Question: brian purchased a music cd retailing business from anthony on...
Brian purchased a music CD retailing business from Anthony on 1 June 2018 for $220,000. He gives you a Settlement Statement for the purchase (this statement sets out the details of the purchase price) that shows:
Purchase price of the business $220,000, comprising:
- CDs for sale (Trading stock) $60,000
- Plant and Equipment (Depreciable assets) $60,000
- Business goodwill $100,000
Assuming Brian is eligible to use the Small Business Entity tax system and chooses to do so, discuss the tax issues that will arise in respect of this purchase.