solve this. The requireds are in the case.

You, CPA, have recently obtained a position with Green Inc. (Green), a manufacturer and distributor of environmentally friendly cleaning products.Jason and Jaclyn Brownstarted the company 20 years ago in response to concerns over the impact of cleaning products on the environment. Green reports under the accounting standards for private enterprises (ASPE).As Green is growing and the financial reporting and tax requirements are becoming more complex, Jason and Jaclyn have decided that they need help and have hired you, CPA, as their financial controller. It is February 10, 2022, and you have just left a meeting with Jason and Jaclyn, andGreen's bookkeeper. Jason has asked you to provide him with an estimate of taxes payable for the year ended December 31, 2021, using an effective tax rate of 13% for active business income below the business limit and 27% for active business income above the business limit. He would also like explanations supporting the adjustments made to net income per the financial statements in the determination of net income for tax purposes and taxable income. Jason provided you with the prior year's corporate income tax return. You reviewed the return and made notes (Appendix I) of relevant information for the current return.Jason has also asked for your advice on whether Green should pay any estimated taxes payable now or wait until the tax return is completed, in two to three months. In order to avoid interest and penalties in the future, Jason and Jaclyn have requested that you calculate Green's corporate income tax instalments for 2022 and provide them with a recommended payment schedule.Jason thinks that Green's taxable income for 2022 will be approximately 25% lower than it was in 2021. In addition to your work on Green's estimate of taxes payable, Jason would like your advice on how to account for the year-end inventory balance and related revenue.You are provided with a copy of Green's draft income statement for the year ended December 31, 2021 (Appendix II), as well as other information needed to calculate the taxes payable amount (Appendix III)

Appendix I

Information from the review of Green's 2020 corporate income tax return Closing undepreciated capital cost (UCC) balances at December 31, 2020, after the 2020 capital cost allowance (CCA) claim, were as follows:

i) Class 8 $129,250

ii) Class 10 (delivery trucks) $141,000

iii) Class 10.1 (car driven by Jaclyn Brown) $14,450

iv) Class 10.1 (car driven by Jason Brown) $10,300

v) Class 43 $12,500

vi) Class 53 $475,040

The Class 53 opening balance relates to additions made in 2018 prior to the introduction of the accelerated investment incentive

Appendix II

Green Inc. Draft income statement For the year ended December 31, 2021 Prepared by bookkeeper(unaudited)

Sales$2,975,000

Cost of sales1,587,000

Gross margin1,388,000

Expenses

Amortization on administrative assets$45,000

Selling, general,and administration395,000

Financial125,000

Total expenses565,000

Operating income823,000

Other income (net)74,500

Net earnings before income taxes$897,500

Appendix III Notes from the bookkeeper related to selected items in the draft income statement

1. Deduction for anticipated decline in inventory valueGreen claimed a $4,000 deduction for a possible decrease in the value of inventory after December 31, 2021, for all year-end inventory items.

2. Selling, general, and administration expensesThe amounts described below are included in the total selling, general, and administration expenses for 2021. i)Current year provision for warranty claims There was no provision in 2020. Actual payments made for defective goods in 2021equalled $3,500.$4,500

ii)Donations to several registered charities$16,000

3. SalesIncluded in the sales total is a payment of $50,000 received from a customer for inventory costing $30,000 to be delivered over January and February 2022. As of year end, none of the inventory was delivered but instead was put aside in the warehouse, with appropriate labelling, ready for delivery. The inventory was excluded from the year-end inventory count, as it was held for the customer rather than available for sale.

4. Cost of salesThe following amount is included in the cost of sales: Amortization of depreciable assets used in manufacturing$125,000

5. Miscellaneous items included in financial expense

i)Interest on the mortgage obtained from the bank and used to purchase the new building. The interest ispaid monthly.$30,000

ii)Expenses incurred in obtaining a mortgage to fund the new building purchase:Accounting fees for preparing pro forma financial statements as required by the bank$9,000Legal fees for mortgage registration and for advice onmortgage covenants$4,000

iii)Premium for a term life insurance policy on Jason and Jaclyn Brown; the policy was assigned to the bank, which required the assignment as collateral. The premium is paid monthly.$6,000

6. Other income

The following amounts are included in other income.

i)A loss on the sale of manufacturing equipment; the equipment was sold in the year for $5,000. The cost of this equipment was $120,000 in 2011and is the only asset in Class 43.$(6,000)

ii)Share of financial statement income earned from a corporate partnership, Davidson & Partners. Green has a 10% interest in this partnership. The form T5013 received from Davidson & Partners showed business income of $37,500.$57,000

iii)Equity income on aninvestment in shares of Larch Inc (a CCPC). Green owns 30% of Larch's shares. Dividends received in the yearfrom Larch were $9,000. Larch did not receive a dividend refund as a result of paying the dividends.$11,100

7. Acquisitions to property, plant, and equipment in 2021

i)Manufacturing building.The building is used entirely for the manufacturing and processing of the industrial cleaning product line. The lease on the old manufacturing building expired during the 2021taxation year.$950,000

ii)Office equipment, purchased in February 2021$5,500

iii)Right to use a patented part for the industrial use cleaning product line, acquired in January 2021$16,000

iv)The car Jason Brown drove was traded in for a new car in May 2021. The old car is recorded in Class 10.1 for CCA purposes. The company received a trade-in value of $10,000 (equal to net book value) toward the $52,000 purchase price of the new car.The new car was purchased in September 2021.$52,000

8. Income tax instalments Green has made

no income tax instalments for the December 31, 2021, year end.

9. Prior-year taxesThe tax liability for 2020 was zero.