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Unformatted text preview: Problem 27 (Past exam question: 32 minutes) (Text: Ch. 2, 3, 8) Your client, Dundas Valley Machinery Ltd. ("Dundas Valley"), has asked you to advise Mr. Fern Flaming on his income tax position for this year. Mr. Flaming was born in Moosonee 55 years ago, was educated in Sudbury and has lived and worked in Canada all of his life. Until mid-April of this year, he had been Executive Vice-President of Dundas Valley, earning an annual salary of $80,000 and a bonus based on the profitability of the corporation that amounted to $8,000 to April 15 of this year. Effective April 15 of this year, Mr. Flaming was promoted to President of the corporation's wholly-owned subsidiary in Mexico. He now earns an annual salary of $100,000 and is eligible for a bonus of $30,000 from April 15 of this year. He also receives a living allowance of $3,000 per month and a travel allowance of $1,200 per month. All of these amounts are paid by the Mexican corporation, including moving costs for his family and household effects which amount...
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This note was uploaded on 11/19/2010 for the course ACC 742 taught by Professor Sydor during the Spring '10 term at Ryerson.
- Spring '10