IVY Inc., is a CCPC and reported accounting net income after tax of $425,000 with tax expense
Question:
IVY Inc., is a CCPC and reported accounting net income after tax of $425,000 with tax expense of $70,000. Included in the company's financial statements is the following information:
Amortization expense - $52,000
Bank charges - $3,000
Interest & penalties on HST - $800
Capital gains (accounting) totaled $60,000
Salaries & Wages - $97,000
Meals & entertainment - $12,000
Commission expense - $10,000
Charitable donations - $10,000 (all to registered charities)
Dividends received from taxable Canadian controlled corporations - $100,000
You have correctly calculated capital cost allowance for the year of $57,000. The company has a net capital loss carry forward balance of $42,000 available at the beginning of the tax year.
1) Compute minimum net income for tax purposes (Division B)
2) Compute minimum taxable income (Division C)
3) Compute the net capital loss carry forward balance at the end of the tax year.
Financial Accounting Tools for Business Decision Making
ISBN: 978-1119368458
7th Canadian edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine