Fast Inc. designs, manufactures and distributes high-end commercial packaging. Fast Inc. operates out of two manufacturing facilities, one in Toronto specializing in paper-based products and one in Kingston that specializes in packing peanuts and plastics. Time left 2:53:44 With consumers becoming more environmentally conscious, the demand for single use plastics has been decreasing. In response, Fast Inc. has started making preparations to sell off its plastics division. The plan is to transfer all the assets relating to the plastics business to a new corporation, Green Holdings (GH), until a buyer can be found for the division. The chart below summarizes the relevant tax information for the various assets of the plastics division. Inventory Accounts receivable FMV $ $ $ 100,000 $ 250,000 $ 60,000 $ $ 1,500,000 $ ACB Land $ 1,000,000 $ Building (class 1) Manufacturing equipment (Class 53) $ 800,000 $ Goodwill (class 14.1) $ 500,000 $ 00 00 00 00 UCC 100,000 $ 245,000 $ 70,000 $ 750,000 $ 800,000 $300,000 1,200,000 $ 900,000 REQUIRED: A. Explain which account(s) SHOULD NOT or CANNOT be transferred to GH using Section 85 election and why? If a particular asset(s) should be transferred under another section of the Act, please provide which Section, and explain the rationale for relying on that other section? B. Fast Inc. intends to transfer all assets except for the cash, accounts receivable and manufacturing equipment to GH using Section 85. Determine: 1) The elected amount for each asset as well as the maximum non-share consideration (i.e. note receivable) and share consideration Fast Inc. should take back on the transfer 2) The adjusted cost base and paid-up capital of the preferred shares received by Fast Inc. on the transfer 3) The ACB, Capital Cost and UCC if applicable of Goodwill to GH following the transfer. Note: You are required to show the full calculation (including the applicable components) in order to earn full marks You are not required to reference legislation in Income Tax Act

Fant inc deoigns, manulacturen and diatributes high-end commercial packaging. Fant inc, operaten out of two manufacturing facilities, one in Toromto specialzing in paperbased preducts and one in Kinguton that npecializes in pocking peanus and plantics. its plastios division. The plan is to transfer all the assets relating to the plastica business to a new corporation, Green Holdingo (OH). until a buyer can be found for the division. The chart below nummarizes the relevant tax information for the various assets of the plastica division. REQUIRED: A. Explaio which account(o) SHOULD NOT or CNNOT be transferrod to GH uning Section sS election and whyn if a particular asset(o) ahould be tranaferred under another section of the Act, please provide which Section, and explain the rationale for relying on that ather section? 6. Fast inc imends to transfer all atsets except for the cash, acoounts rtceivable and manufacturing equipment to GH using Section 85 . Determine: 1) The elected amount for each asset as well as the maximum non-ahare consideration (i.e. note receivable) and share consideration Fast inc, ahould take back an the transfer 2) The adjusted cost base and paid up capital of the preferred ahares receved by Fam ince on she transfer 3) The ACe, Capital Cost and UCC if applicable of Goodwill to GH fallowing the transfec: Note: You are required to show the full calculation (including the applicable components) in order to earn full marks You are not required to reference legislation in Income Tax Act