Assignment Problems Solutions to Assignment Problems (APs) are available to instructors only. AP 12-1 (Corporate Taxable Income) The income statement that has been prepared by Margo Ltd.'s accountant for the year ending December 31, 2021, is as follows: Sales revenue Cost of goods sold (Note 1) Gross profit Operating expenses: Salaries and wages Rents ($40,200) ( 22,200) $925,000 ( 717,000) $208,000 Property taxes (Note 2) ( 8,800) Amortization expense ( 35,600) Write-down of goodwill (Note 3) ( 1,700) Charitable donations ( 19,800) Legal fees (Note 5) ( 2,220) Bad debt expense (Note 6) ( 7,100) Warranty provision (Note 7) ( 5,500) Social club membership fees (Note 8) 7,210) Other operating expenses ( 39,870) ( 190,200) Operating income $ 17,800 Other revenues (expenses): Gain on sale of investments (Note 9) $ 9,500 Interest revenue 2,110 Interest on late income tax instalments ( 1,020) Investment counsellor fees ( 500) Foreign interest income (Note 10) 1,530 Dividends from taxable Canadian corporations 3,000 14,620 Income before taxes $ 32,420