The controller of Niagara Productions Inc., a Canadian public corporation, has prepared the accounting income statement...

 

Transcribed Image Text:

The controller of Niagara Productions Inc., a Canadian public corporation, has prepared the accounting income statement for the fiscal year ended December 31, 2022: Niagara Productions Inc. Income Statement For the Year Ended December 31, 2022 Revenue Expenses: Cost of sales Administrative expenses Operating income Other income & expenses Provision for income taxes Net income $2,137,000 $5,214,000 612,500 (2,749,500) $2,464,500 (79,500) $2,385,000 (788,640) $1,596,360 Additional information: 1. Niagara Production Inc. has permanent establishments in the United States, and Ontario. Its gross revenues and salaries and wages data have been allocated as follows: Ontario United States 1,564,200 3,649,800 Gross revenues Salaries and wages 326,500 183,656 2. Revenue and Expenses include the following: (a) Interest on late income tax payments (b) Club dues for CEO in the local Country Golf Club (c) Donations to registered charities 3. Other income & expenses include the following: (a) Dividends received from taxable Canadian corporation $2,356 4,780 31,520 29,83 (b) Foreign interest income, net of $8,400 withhold tax 56,00 (c) Gain on sale of vacant land with a cost of $45,000 sold for $106,200 61,200 4. The company has the following carry forward balances: (a) Non-capital losses (realized in 2007) (b) Net capital losses (realized in 2015) (c) Donation made in 2019 to registered charities 21,620 8,000 1,800 5. For 2022, the company's non-business income foreign tax credit was $8,400, and its business income foreign tax credit was $97,680 (assume the foreign tax credits were calculated correctly). 6. Assume the provincial rate for Ontario is 12% and the province calculates taxable income on the same basis as federal taxable income. Required: Calculate the Division B income, Taxable income, Part I Federal Tax Payable, and Total Tax liability for Niagara Productions Inc. for the 2022 taxation year. Show all calculations. The controller of Niagara Productions Inc., a Canadian public corporation, has prepared the accounting income statement for the fiscal year ended December 31, 2022: Niagara Productions Inc. Income Statement For the Year Ended December 31, 2022 Revenue Expenses: Cost of sales Administrative expenses Operating income Other income & expenses Provision for income taxes Net income $2,137,000 $5,214,000 612,500 (2,749,500) $2,464,500 (79,500) $2,385,000 (788,640) $1,596,360 Additional information: 1. Niagara Production Inc. has permanent establishments in the United States, and Ontario. Its gross revenues and salaries and wages data have been allocated as follows: Ontario United States 1,564,200 3,649,800 Gross revenues Salaries and wages 326,500 183,656 2. Revenue and Expenses include the following: (a) Interest on late income tax payments (b) Club dues for CEO in the local Country Golf Club (c) Donations to registered charities 3. Other income & expenses include the following: (a) Dividends received from taxable Canadian corporation $2,356 4,780 31,520 29,83 (b) Foreign interest income, net of $8,400 withhold tax 56,00 (c) Gain on sale of vacant land with a cost of $45,000 sold for $106,200 61,200 4. The company has the following carry forward balances: (a) Non-capital losses (realized in 2007) (b) Net capital losses (realized in 2015) (c) Donation made in 2019 to registered charities 21,620 8,000 1,800 5. For 2022, the company's non-business income foreign tax credit was $8,400, and its business income foreign tax credit was $97,680 (assume the foreign tax credits were calculated correctly). 6. Assume the provincial rate for Ontario is 12% and the province calculates taxable income on the same basis as federal taxable income. Required: Calculate the Division B income, Taxable income, Part I Federal Tax Payable, and Total Tax liability for Niagara Productions Inc. for the 2022 taxation year. Show all calculations.

Answer rating: 100% (QA)

To calculate the Division B income Taxable income Part I Federal Tax Payable and Total Tax liability for Niagara Productions Inc for the 2022 taxation ... View the full answer