Joans Party Planners Limited provides start-to-finish party planning services for all occasions. A summarized set of financial statements for the taxation year ended December 31, 2016 are set out below:

Joans Party Planners Limited

STATEMENT OF INCOME

For the year ended December 31, 2016

Revenues ................................................................................................ $561,000

Expenses: General and administrative ................................$411,930

Amortization on fixed assets ...............................................28,170 .............440,100

..................................................................................................................120,900

Gain on disposal of fixed assets (see details below) ....................................... 79,100

Net income before income taxes ....................................................................200,000

Provision for income taxes ............................................................................. 43,240

Net income after income taxes ....................................................................$156,760

Additional information related to 2016 is provided below.

The opening UCC balances as at January 1, 2016 were as follows:

Class 1 .................................................................. $30,000

Class 6 .................................................................. 2,100

Class 8 .................................................................. 2,000

Class 10 ................................................................ 11,000

CEC ....................................................................... 18,000

During 2016, Joans Party Planners Limited purchased the following depreciable assets:

Office furniture .......................................................................................... $15,000

Delivery van ............................................................................................... 30,000

Computer equipment & related systems software (October 2016) ......... 10,000

Computer word processing applications software .................................... 6,000

Cutlery and dishes ..................................................................................... 21,000

Kitchen utensils (less than $200 each) ...................................................... 1,000

Photocopy machine ................................................................................... 2,600

In April 2016, Joans Party Planners Limited sold their owned business premises (consisting of land and a Class 1 building) and moved to a more suitable location, which is currently being rented. They received proceeds of $20,000 for the land (original cost of $5,000). The Class 6 asset mentioned above is the fence that was erected around these former business premises. On the sale of these premises, no proceeds were allocated to the fence. This was the only asset in Class 6.

Joans Party Planners Limited signed a lease agreement for the rental space for 10 years, with 3 renewal periods of 2 years each. To get the space ready for their use, they spent $30,000 in renovations and $10,000 in landscaping which were both capitalized for accounting purposes.

The details of the sale of the former Class 1 building, as well as the other depreciable assets sold during 2016, are set out below:

Proceeds / Original Cost / Net book value

Cl 1 building 125,000 / 45,000 / 40,000

Furniture 6,000 / 8,000 / 5,120

Delivery van 4,500 / 18,000 / 6,175

Office equipment 5,000 / 15,000 / 4,915

Table linens 3,000 / 25,000 / 8,190

During 2016, Joans Party Planner Limited purchased the client list from a competitor who was going out of business. They paid $12,000 for this list.

Required: 1) Calculate Joans Party Planner Limiteds maximum CCA & CECA for the year ended December 31, 2016 and indicate the UCC/CEC balances at the beginning of 2017.

2) Calculate Joans Party Planner Limiteds minimum business income for the year ended December 31, 2016.

3) Calculate Joans Party Planner Limiteds net taxable capital gains (i.e. 3(b))