CorporateProblem

CorporateProblem - 100,000 Charitable donations 40,000...

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ASSIGNMENT QUESTION CORPORATION INCOME TAX Scotia Limited, a non-manufacturer located in the province in which you live, is owned by a group of twenty-five individuals who are residents of Canada. Each owns 4% of the voting shares. None of the shares are publicly traded. The following is a summary of the company’s income statement for the year ended December 31, 20X7. Revenues: Sales $800,000 Interest on long-term Canadian bonds 20,000 Interest on savings account 1,000 Rental of an unused warehouse (one year of a five year lease) 20,000 Temporary rental of warehouse space 2,000 Dividends – Royal Bank of Canada 10,000 – From a non-taxable Canadian company* 15,000 Capital gain 60,000 928,000 Expenses: Operating $300,000 Selling and administration
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Unformatted text preview: 100,000 Charitable donations 40,000 Political donations federal 1,050 441,050 Net income $486,950 * Assume for purposes of this problem that such a company exists. The 20X6 T2 return indicated that the following, all of which arose in 20X3, are available for 20X7: Charitable donations $70,000 Net capital losses 60,000 Non-capital losses 100,000 The companys depreciation expense is equal to the annual capital cost allowance amount. REQUIRED: For the 20X7 taxation year, compute: (a) Minimum net income for tax purposes (b) Active business income (c) Taxable income (d) Federal Part I taxes payable (e) Any amounts which can be carried to 20X8 (f) Provincial income taxes for the province in which you live...
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CorporateProblem - 100,000 Charitable donations 40,000...

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