Jonsub Itd. is a wholly owned subsidiary of Normpar Itd . Both are Canadian companies* located in Saskatchewan . The two companies plan to merge on December 31*; either by amalgamating or by winding up Jonsub into Normpar . The balance sheet of Jonsub It'd immediately before the merger is as follows :" Assets : FNIV Cash 80,000 Accounts receivable [net of $30, 000 reserve ) 300.090 Inventory at cost 920, 000 5.920.000 Land at cost 1, 200,000 2,000,000 Building at UCC 300, 000 50.0,000 Equipment at LICE 200,000 150, 000 Goodwill 50.0, 000 Total current assets 53, 500, 000 Liabilities and shareholder's equity . Accounts payable and accrued liabilities 703,000 Loans payable* 700,000 Share capital 1, 000 Retained Earnings 2.090,000 53. 50.0,000 Other Information I] Normpar Itd. acquired all of the shares of Jonsub Itd. for $ 4 million 5 years ago . The total ammount of dividends paid by Jonsub Led to Normpar Itd. during the period of ownership is $5.00, 000 . 2)` The fair market value of the land and building at the time Normgar Itd . acquired control were $1 . 5 million and $ 100, 000 respectively . 31 The fair market value of goodwill developed by Jonsub Lid . (i.e. , not purchased ) was 5300, 000 at the time Normpar Itd . acquired control . 4 ) Both companies are profitable . You have been asked to advise both Jonsub and Normpar on the tax consequences of either an amalgamation or a winding - up and recommend the best option . The client is concerned about*