Greyon Inc. operates an active business. Financial statements for the year ended December 31, 2020 report a net Income before taxes of $300,000. The following additional Information is provided: 1. Greyon's net income is summarized as follows: Income from business operations Gain on sale of capital assets Interest on a bond Investment Income from Financial Statements $338,800 18.200 6.100 $363.100 2. During the year Greyon completed construction of a new warehouse building and its cost of $600,000 was added to the balance sheet. The cost consists of the following: Building construction $605,000 Heating and cooling systems 96,800 Landscaping of grounds 24,200 $726,000 3. Legal expenses Include $2,400 for drafting the mortgage document for the new warehouse, $1,200 to Investigate a zoning limitation on the new warehouse site, and $6,100 for the audit fee. 4. The balance sheet of Greyon Includes an amount for goodwill acquired from a previous business acquisition. During the year, a goodwill Impairment loss of $36,300 as deducted from the income from business operations. 5. A management bonus of $72,600 was announced and accrued in September. The bonus was paid in two equal Installments on January 31 and April 30 of the following year, 2021. 6. The Income statement for the year ended December 31, 2020 includes the following items: Amortization $49,600 Charitable donations 7,300 Volume rebates and discounts on purchases 15,700 Architect's fee for design of new warehouse building 30.300 7. Advertising and promotion includes $24,200 for airing a TV commercial, $36,300 for production of the TV commercial, $6,100 for club memberships in a sports-related facility to enhance business contacts and $14,500 for acquiring a permanent mailing list for seeking new customers. 8. Capital cost allowance has been correctly calculated as $70,200. Required: 1. Determine Greyon's Net Income from Business for tax purposes for the 2020 taxation year. 2. Determine Greyon's Net Income for Tax Purposes for the 2020 taxation year. Net Income From Business Segment A Income Subtotal Net Income for Tax purposes Airing a TV commercial Amortization Architectos fee Audit fee Capital cost allowance Charitable donations Club memberships Gain on sale of capital assets Goodwill impairment Interest - bond investment Landscaping Legal fees -investigate zoning Legal fees for mortgage Mailing list Mgmt bonus Mgmt bonus Net Income per Financial Statements Production of TV commercial Taxable Capital Gains Volume rebates and discounts on purchases Greyon Inc. operates an active business. Financial statements for the year ended December 31, 2020 report a net Income before taxes of $300,000. The following additional Information is provided: 1. Greyon's net income is summarized as follows: Income from business operations Gain on sale of capital assets Interest on a bond Investment Income from Financial Statements $338,800 18.200 6.100 $363.100 2. During the year Greyon completed construction of a new warehouse building and its cost of $600,000 was added to the balance sheet. The cost consists of the following: Building construction $605,000 Heating and cooling systems 96,800 Landscaping of grounds 24,200 $726,000 3. Legal expenses Include $2,400 for drafting the mortgage document for the new warehouse, $1,200 to Investigate a zoning limitation on the new warehouse site, and $6,100 for the audit fee. 4. The balance sheet of Greyon Includes an amount for goodwill acquired from a previous business acquisition. During the year, a goodwill Impairment loss of $36,300 as deducted from the income from business operations. 5. A management bonus of $72,600 was announced and accrued in September. The bonus was paid in two equal Installments on January 31 and April 30 of the following year, 2021. 6. The Income statement for the year ended December 31, 2020 includes the following items: Amortization $49,600 Charitable donations 7,300 Volume rebates and discounts on purchases 15,700 Architect's fee for design of new warehouse building 30.300 7. Advertising and promotion includes $24,200 for airing a TV commercial, $36,300 for production of the TV commercial, $6,100 for club memberships in a sports-related facility to enhance business contacts and $14,500 for acquiring a permanent mailing list for seeking new customers. 8. Capital cost allowance has been correctly calculated as $70,200. Required: 1. Determine Greyon's Net Income from Business for tax purposes for the 2020 taxation year. 2. Determine Greyon's Net Income for Tax Purposes for the 2020 taxation year. Net Income From Business Segment A Income Subtotal Net Income for Tax purposes Airing a TV commercial Amortization Architectos fee Audit fee Capital cost allowance Charitable donations Club memberships Gain on sale of capital assets Goodwill impairment Interest - bond investment Landscaping Legal fees -investigate zoning Legal fees for mortgage Mailing list Mgmt bonus Mgmt bonus Net Income per Financial Statements Production of TV commercial Taxable Capital Gains Volume rebates and discounts on purchases
