Part A

Purpose: To familiarize students with section 3, source, and the importance of persons.

Please calculate NITP for Emerson using section 3 format for the 2017 taxation year based on the facts provided below. Indicate the amount and

type of any loss carryovers that would be available at the end of the current year, or state that no carry overs are available.

Scenario 1

Facts Amount

Emerson was paid salary by virtue of being an employee of Apple Inc. 83,480

Emerson was paid a bonus by Apple Inc. which was earned in 2017 on May 15, 2017 40,000

Emerson invested in Canada Savings Bonds and earned interest income 4,622

Emerson sold shares of Blackberry, a publicly traded corporation and realized an allowable capital loss (4,835)

Emerson sold shares of Netflix, a publicly traded corporation and realized a capital gain 48,492

Emerson owns 100% of the outstanding shares of Empire Ltd. The corporation generated net income 200,000

Emerson had deductible child care costs (9,372)