accounting for corporate income taxes

Traditional Concepts Inc. (TCI) reported the following accounting income before income taxes for the past year of operations: Fiscal Year 2021 Accounting Income $ 453,509 The following list of items created differences between accounting and taxable income for the year ended December 31, 2021: (a) TCI sells a product with a 2-year assurance warranty. Information pertaining to this warranty follows: Number of units of product sold in 2021 Estimated warranty cost per unit Warranty costs paid in 2021 Balance in Warranty liability account at December 31, 2020 $ $ $ 6,461 36 100,016 50,336 (b) The company depreciates all of its property, plant and equipment on a straight-line basis for accounting purposes. In the calculation of taxable income, the company deducts capital cost allowance (CCA). TCI did not purchase nor dispose of any property, plant or equipment during 2021. Other information pertaining to the company's depreciable assets follows: Undepreciated capital cost (UCC) at December 31, 2021 Net book value of property plant and equipment at December 31, 2021 Capital cost allowance deducted on tax return for 2021 Depreciation expense for 2021 $ $ $ $ 375,275 463,302 153,580 99,827 (c) In 2021, TCI paid country club dues on behalf of two members of its senior management team. These dues were recorded in the Entertainment Expense account that appears on the 2021 income statement. Total country club dues paid $ 7,404 (d) During 2021, TCI received dividends from a taxable Canadian corporation. These dividends were included in accounting income for the 2021 year. Amount of dividends received from taxable Canadian corporation $ 3,154 Assume that for both financial reporting and income taxes, TCI has a year end of December 31, 2021. The company follows IFRS, and is subject to a corporate tax rate of 32%. TCI had the following balance in its deferred tax asset account on December 31, 2020: $ 5,140 Required: 1. Calculate taxable income and income tax payable for the 2021 year. (6 marks) 2. Determine the amount that will appear on the December 31, 2021 statement of financial position for deferred taxes. (3 marks) 3. Prepare the journal entries to record income taxes for 2021. (2 marks) 4. Prepare the income tax expense section of the income statement for 2021, beginning with the line "Income before income taxes". (1 mark)