Question

ABC Co. provides a company car to Danny. The cost of the car was $20,000 including HST. The car was driven for a total of 26,000 kilometres during 2020 and its operating costs for the year were $4,000. It was used by Danny for the whole year. He drove a total of 9,000 kilometres for personal purposes.

Instructions:

Calculate the Auto Benefit that Danny will include in his employment income by filling in the five (5) blanks below. Do not leave any blanks - if there is no value to input, enter "none" :

Standby Charge:
Reduced Standby Charge:
Operating Cost Benefit:
Alternate Operating Cost Benefit:
Total Auto Benefit:

Answer 1

Stand by Charge
Cost of the vehicle including HST	20000
# of months available for use	12
Total Kilometers driven	26000
Kilometers driven for Personal use	9000
Standby charge=$20000x2%x12monthsx9000/20004
	2160
Reduced standby charge
Standby charge	2160
personal kilometers driven	9000
Total Kilometrs driven	26000
Reduced standby charge=9000/26000	35
Reduced Standby charge=Standby Charge*35	756
Operating Cost Benefit
# of miles for personal Use
Total operating Cost	$4,000
Total Kilometers Driven	26000
For Personal Use	9000
Per Km Cost	.28c/km
Operating cost benefit =9000*.28	2520
Total Auto Benefit
Operating Cost Benefit	2520
Plus; Standby Charge	2160
Total Auto Benefit	4680
Alternate Operating Cost Benefit
Cost of the vehicle including HST	20000
# of months available for use	12
Total Kilometers driven	26000
Kilometers driven for Personal use	9000
Alternate Operating Cost Benefit=9000/26000*4000	1385