Central Products Ltd., which sells goods Canada-wide, is in the processof completing its 2018 financial statements and

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Question:

Central Products Ltd., which sells goods Canada-wide, is in the processof completing its 2018 financial statements and tax return. A junior accountant has given you a list of items that he does not know how to treat for tax purposes:

1.
Purchase price of a patent giving the company exclusive rights to manufacture a product

$120,000

2.
Cost of annual dues to a golf club for three senior salespeople to entertain existing and potential customers

8,000

3.
The union contract expired four months before the year end and bargaining is still in process. A 3% wage increase is expected, and the company has recorded a reserve to cover the four-month period

60,000

4.
Legal fees paid for making a representation to a provincial government against a proposal to introduce a payroll tax

15,000

5.
Donations paid to a registered charity
10,000

6.
Advertising in a foreign trade newspaper that was distributed to Canadian customers

4,000

7.
Travel costs (airfare and lodging) for a senior executive to visit a Foreign supplier to inspect and sign a purchase agreement for a new manufacturing machine. The machine was delivered and used in 2018

3,000

8.
Legal, accounting, and printing costs to prepare a prospectus offering common shares for sale to the public

32,000
9.
Cost for attending three conventions during the year. Convention #1 ($750) in Vancouver was in July 2018. Conventions #2 in Calgary ($1,350) and #3 in Toronto ($1,050) were both in December 2018. Each convention includes a cost of $100 for meals.

3,150
10.
Interest for late payment of municipal property tax for the warehouse

500
11.
Christmas gifts to staff (under $100 each)

$1,200
12.
Hockey tickets to entertain customers

$2,000

Required:

For each of above items advise whether or not it is deductible in calculating Income from Business and how much and provide the Income Tax Act reference in support.