Introduction to taxation

Introduction to federal income taxation in Canada

On January 1 2018 r ufacturing and processing which is 95% of their business, with a December 31 Class 1-MB Class 8 Class 10.1 Class 12 Class 13 3 Chapter 5-Additional Chazerai Ltd. i year-end. On January 1, 2018, the undepreciated engaged in capital costfor each class of its assets w as as follows: $289,401 60,000 17,850 5,000 175,000 building -office furniture and equipment - leasehold improvements The follow ing additional information was found in the 2018 audit files: n The building, w hich cost $4864 309 in 2013, w as sold for $260.000. It w as the only building the time of ts sale. The underlying land was sold for proceeds equal to the org nai c purchased a new building in August 2018 for $600,000. $5,000. None of the old assets were sold for more than original cost Some small tools were sold for a total of $7,000. Al of these tools w ere sold at a price less than their original Ne offi frnture was purchased for $20.000. This purchase replaced old assets, which w ere sold for 9 cost The opening balance in aass 13 represents leasehold improvements of $210,000 made during 2016 to the at a cost of $24,000. The remaining lease term was five years w ith tw o successive tw o-year renew alterms leased warehouse. During 2018, further leasehold improvements w ere made to the same leased w arehouse 9 The Class 10.1 automobile w as purchased in 2016 for D A iense (expected to be used indefinitely) was purchased for $60,000 in June 2018 0 A new computer w as purchased in January 2018 for $7,000. automobie w as purchased for $45,200, w hich included HST of $5,200 (13%). $34,000. During 2018, it w as sold for $21,000. A new Chazerai Ltd. is registered to colect and remit HST. REQUIRED to show the maximum deductions for tax purposes available to Chazerai Ltd. for 2018 based on the above information