Income tax and depreciation. A shop in Calgary has following financial data: The lease for shop and warehouse costs $30,000 per year; The total cost of shop plant was $200,000, depreciated at a 30% CCA rate. It has been depreciated for three years. Now it is the end of 4th year; The total cost of merchandise sold in this year (i.e. 4th year) is $600,000; The employee salaries and benefits are counted in total of $300,000 in this year; The overhead in this year is $100,000; The company has a gross income of $2,000,000 for this year.

a) Calculate the taxable income

b) Calculate the Alberta provincial income tax. (General: 10%; Small Business: 2%; Business limit: $500,000)

c) Calculate the Federal income tax. (General: 15%; Small Business: 9%; Business limit: $500,000)

d) Calculate the effective tax rate.