You are the sole shareholder of ABC Corporation. ABC is based in Toronto, Ontario, and earns 100% of its income in Canada. The net income for tax purposes is $575,000. ABC’s taxable capital is $9 million (relevant for purposes of determining whether there is any reduction to the SBD). The following income/expenses have been included in the net income for tax purposes: Taxable capital gain (sale of the active asset) $19,000 Dividends received from CDN corporations $22,000 Interest income $18,000 ABC has the following carryover information: 

Charitable donations (set to expire this year) $ 5,000 Net capital loss (from 2013) $33,000 The following information relates to the $22,000 dividends received by ABC Corp. % of ownership owned by ABC Taxable dividend received by ABC Dividend refund received by Corp. 1 or 2 Corp. 1 8% $10,000 (eligible) $5,000 (paid out of eligible RDTOH) Corp. 2 15% $12,000 (non-eligible) $9,000 (paid out of non-eligible RDTOH) ABC Corp. paid non-eligible dividends of $7,000 to its sole shareholder in the current year. The following additional information is available for ABC Corp. 

• NERDTOH Dec 31, Prior Year $5,000 

• ERDTOH Dec 31, Prior Year $4,000

• Dividend refund received by ABC Corp. 0 

• Capital losses deducted in prior years (in Div C) 0   

REQUIRED: 

You must calculate the corporate taxes payable for the current year. 

This includes • Part I federal taxes payable for ABC Corp.

Answer rating: 100% (QA)

ANS WER 5 750 C AL C UL ATION Net Income for ... View the full answer