Ambee Ltd. commenced operations in 2019, and has two separate lines of business. They are a mail order operation selling organic food products, and an operation that provides accounting services to small business.  The income (loss) of the two operations for the years 2019 and 2020 are as follows:

                                                           Mail Order        Accounting

Year                                                  Operation           Operation

2019                                                   ($146,000)             $ 43,000

2020                                                         56,000                85,000

The Company has no deductions from Net Income For Tax Purposes other than possible loss carry forwards from 2019.

Required: 

Determine the minimum Taxable Income for 2019 and 2020, and any loss carry forward available at the end of each year assuming that there was an acquisition of control on January 1, 2020.

Answer rating: 100% (QA)

Step 1 In business there are time when losses may occur but tax has provision to carry ... View the full answer