What are the tax treatment for the following items list below for a corporate tax return ?

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What are the tax treatment for the following items list below for a corporate tax return ?

a) Many ETI executives are members of golf clubs, ETI covers teh cost of their dues as part of the employees benefit package the cost of these memberships totalled $112,000 in 2019.

b) Meals and entertainment costs for ETI totalled $550,000 in 2019. Of this $150,000 related to the meals and entertainment costs associated with ETI’s annual holiday party and annual summer BBQ. All staff are invited to these events.

c) ETI paid $13,000 to CRA for late filing in 2019

d) ABC a Canadian CCPC operates various establishments. ABC has one wholly owned subsidiary, Earn Frank Corporation (EFC). Sarah would like to know how much federal corporate tax ABC can expect to pay for 2019.

Sarah would like you to calculate the 2019 federal taxes payable taking into consideration the draft income statement and additional information. Sarah expects to use $400,000 of small business limit on its 2019 tax returns and the remainder available for EFC.

Encountered a delay in filing the prior year’s tax return. ABC was charged for $500 late filing penalty and $670 in late payment interest. These have been included in bank charges and interest income on the income statement.

The 90,000 of depreciation is related to building, furniture and equipment. Capital addition in 2019 included $30,000 for furniture and $50,000 for computer equipment. These have been included in PPE and their depreciation is part of the 90,000 on the income statement. The opening UCC balance are as follows

Class 1 $345,000

Class 8 $75,000

Income Statement

For the year ended December 31 2019


Sales		1652000

Advertising and Promotion		277000
Bank Charges & Interest		30000
Depreciation		90000
License		100000
Ofice		90000
Renovation		250000
Salaries		590000

Net income before tax		225000