\"LaserMaster Inc., an Edmonton, Alberta-based CCPC laser-printing service compa
ID: 2554708 • Letter: #
Question
"LaserMaster Inc., an Edmonton, Alberta-based CCPC laser-printing service company, had a sales revenue of $1,500,000 during the 2008 tax year. The following represents the other financial information relating to the tax year Labour e Material costs CCA Rental expenses Proceeds from the sale of old printers $450,000 $200,000 S35,000 S55,200 S26,000 xpenseS [The printers had a combined UCC of $20,000 at the time of sale. Assume that the cost base for the printers was more than $26,000.] (a) Determine the taxable (operating) income for the tax year (b) Using the taxable income calculated in part (a) of the question as the basis, determine the amount of income taxes on operating income (c) Determine the taxable gains for the tax year (d) Determine the disposal tax effect."Explanation / Answer
a. Computation of Taxable(Operating) Income Particular Amount Amount Revenue $1,500,000.00 Less: Material Cost $200,000.00 Labour Expense $450,000.00 Rental Expense $55,200.00 CCA $35,000.00 $740,200.00 Taxable Operating Income $759,800.00 b. Computation of Income Tax On Operating Income Taxable Operating Income $759,800.00 Income Tax @15% $113,970.00 c. Computation of taxable gain for the year Salvage Value $26,000.00 Less:UC $20,000.00 Taxable Gain $6,000.00 d. Computation of Disposable Tax Effect Taxable Gain on sale of Printer $6,000.00 Income Tax @ 15% $900.00
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