At year end, Daisy was pleased with her operation (Daisy's Garden Supplies) having sold 36,000 units at $36 per unit, earning a total sales revenue of $1,296,000. However, before she can celebrate, she needs to know what she owes to Canada Revenue Agency (CRA). The inventory account indicates a beginning inventory of $50,000, 36,000 units produced at a cost of $9 for the period, and a closing inventory balance of $185,000. In producing this revenue, interest expenses of $45,000 and operating expenses of $112,000 were incurred. If the corporation's after-tax net income is $785,000, what is the income tax expense recorded for the period? Assume that the aforementioned expenses are the only expenses incurred during this period.

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To calculate the income tax expense we need to determine the taxable income ... View the full answer