Calculate the balance in Hard Hat Construction Ltd.'s capital dividend account as at December 31, 2021...

  

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Calculate the balance in Hard Hat Construction Ltd.'s capital dividend account as at December 31, 2021 showing the maximum capital dividend (if any) that could be paid at that time. Show all calculations, and explain why you omitted any of the above amounts in your answer. You, CPA, have been approached by your client, Adam Smith, to determine the capital dividend account for his company, Hard Hat Construction Ltd ("Hard Hat")., a Canadian controlled private corporation incorporated in 2014. You have reviewed the tax returns of the corporation for the period January 1, 2014 to December 31, 2021 and correctly made the following notes: February 28, 2016 May 28, 2017 September 30, 2019 October 1, 2019 January 30, 2020 August 30, 2020 September 14, 2020 June 30, 2021 Sold land inventory for $125,000 Sale of shares held in a public corporation for proceeds of $52,000; the shares had cost $68,000 and Hard Hat paid a sales commission of $1,800 The company sold land and building with proceeds of $48,000 and $132,000 respectively. The costs at time of purchase were $32,000 for land and $98,000 for the building. The UCC on the building was $114,450. The company sold equipment for proceeds of $11,000 with an original cost of $16,750. The UCC on the equipment was $7,720. On this date the company also sold a customer list for $60,000 originally purchased for $50,000. The company sold investments for $36,000. The original cost was $45,000. The commissions paid on the sale was $1,500. Received $30,000 as a dividend from the capital dividend account of a wholly owned subsidiary Received life insurance proceeds of $150,000 in the company on the life of a key employee. The corporation paid total premiums of $23,000 on the policy. The corporation paid a dividend to Adam of $80,000 out of the Capital Dividend Account. Calculate the balance in Hard Hat Construction Ltd.'s capital dividend account as at December 31, 2021 showing the maximum capital dividend (if any) that could be paid at that time. Show all calculations, and explain why you omitted any of the above amounts in your answer. You, CPA, have been approached by your client, Adam Smith, to determine the capital dividend account for his company, Hard Hat Construction Ltd ("Hard Hat")., a Canadian controlled private corporation incorporated in 2014. You have reviewed the tax returns of the corporation for the period January 1, 2014 to December 31, 2021 and correctly made the following notes: February 28, 2016 May 28, 2017 September 30, 2019 October 1, 2019 January 30, 2020 August 30, 2020 September 14, 2020 June 30, 2021 Sold land inventory for $125,000 Sale of shares held in a public corporation for proceeds of $52,000; the shares had cost $68,000 and Hard Hat paid a sales commission of $1,800 The company sold land and building with proceeds of $48,000 and $132,000 respectively. The costs at time of purchase were $32,000 for land and $98,000 for the building. The UCC on the building was $114,450. The company sold equipment for proceeds of $11,000 with an original cost of $16,750. The UCC on the equipment was $7,720. On this date the company also sold a customer list for $60,000 originally purchased for $50,000. The company sold investments for $36,000. The original cost was $45,000. The commissions paid on the sale was $1,500. Received $30,000 as a dividend from the capital dividend account of a wholly owned subsidiary Received life insurance proceeds of $150,000 in the company on the life of a key employee. The corporation paid total premiums of $23,000 on the policy. The corporation paid a dividend to Adam of $80,000 out of the Capital Dividend Account.

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To calculate the balance in Hard Hat Construction Ltds capital dividend account as at December 31 2021 and determine the maximum capital dividend that ... View the full answer