In its first two years of operations, ending in 2020, Odoi Inc paid taxes of $5,700

on taxable income of $30,000. The tax rate for 2021 is 20%.

Odoi Inc's loss before taxes for 2021 is $152,000. Odoi Inc's expenses included

$710,000 of depreciation expense, and meals and entertainment costs of $18,000

(they are one-half deductible for tax purposes).

At the beginning of the year, Odoi Inc had a future tax liability of $24,700 based on

$130,000 of temporary differences related to its fixed assets.

Odoi Inc will claim $660,000 of CCA in 2021. Management anticipates using all of

the loss carryforwards within the allowable carryforward period.

Odoi Inc has a calendar year end.

Required:

a) Calculate Odoi Inc's taxable income/loss for 2021.

b) Prepare the journal entries to record income taxes for 2021.

c) Calculate Odoi Inc's 2021 total tax expense/recovery. What is their effective tax

rate for 2021?