Maleki Ltd is a Canadian controlled private corporation throughout its taxation year ending December 31, 2018. Its 2018 income Statement prepared in accordance with GAAP, is as follows

Maleki Ltd.

Income Statement

Year Ended December 31, 2018

Sales $1,215,800

Cost Of Sales (389,000)

Gross Margin $826,800

Other Expenses (Excluding Taxes):

Wages and Salaries ($153,400)

Amortization (49,300)

Rent (56,700)

Interest Expense (5,500)

Travel and Promotion (44,300)

Bad Debt Expense (5,400)

Warranty Expense (5,800)

Charitable Donations (49,500)

Other Operating Expenses (19,800)(389,700)

Operating Income $ 437,100

Investment Income 146,920

Gain On Sale Of Investments 76,500

Income Before Taxes $ 660,520

Other Information:

1. In determining the Cost of Sales, the Company deducted a $17,800 reserve for inventory obsolescence.

2. Wages and salaries includes a $35,000 bonus to Malakei Ltd.'s CEO. Because she anticipates retiring at the end of 2019, this bonus will not be paid until January, 2020.

3. Amortization is on the furniture and fixtures and delivery vehicles. The capital cost of the furniture and fixtures is $147,000 and, at January 1, 2018, the Class 8 UCC balance

is $79,800. During 2018, new furniture was acquired at a cost of $20,500. Old furniture with a capital cost of $14,200 was sold for $9,500.

On January 1, 2018, the Class 10 UCC balance was $103,400. There were no additions or disposals in this Class during the year.

4. The interest expense relates to a line of credit that was used to finance seasonal fluctuations in inventory.

5. The travel and promotion expense consisted of the following items:

Business Meals And Entertainment $15,200

Hotels And Airfare 21,400

Golf Club Memberships 7,700

Total Travel And Promotion Expense $44,300

6. For accounting purposes, the Company establishes a warranty reserve based on estimated costs. On January 1, 2018, the reserve balance was $5,400. On December 31, 2018, a new reserve was established at $6,200.

7. Investment income consists of interest income of $78,150 on BC Hydro bonds, foreign non-business income received of $13,500, net of withholding tax of $4,500, eligible dividends on portfolio stock investments on TSX companies of $22,670, and non-eligible dividends of $21,600 from a wholly owned subsidiary, Chicklet Inc. Chicklet received a refund of $6,000 on paying the dividends.

8. The accounting gain on the sale of investments is equal to the capital gain for tax purposes.

9. Included in the company's gross margin is foreign business income of $41,500. The foreign jurisdiction withheld $4,150 for the foreign business income.

10. You may assume the foreign tax credits for business and non-business foreign income to be the same as the amount withheld. In other words, you do not need to compute foreign tax credits with Adjusted Division B income or Tax Otherwise Payable on page 610 of your textbook.

11. Using the formula described in ITR 402, it has been determined that 87 percent of Malakei Ltd.'s Taxable Income was earned in a Canadian province.

12. Malakei Ltd. has available a net capital loss balance of $45,000 and a non-capital loss balance of $10,200. Management has indicated that they would like to deduct as much of these amounts as possible in the 2018 tax return.

13. During 2018, the Company declared and paid dividends of $162,000. Of this total, $24,000 was designated as eligible dividends.

14. Malakei Ltd. is associated with two other Canadian controlled private corporations. They have agreed to allow Eagles to claim $120,000 of the total annual business limit.

15. The December 31, 2017 balance in the Refundable Dividend Tax On Hand (RDTOH) account was $193,500. The dividend refund for the year ending December 31, 2017 was $47,300.

16. At the end of 2017, Eagles has a GRIP of $32,400. During 2017, the company designated $26,800 of its dividends as eligible.

Determine Malakei Ltd.'s minimum Taxable Income for the year ending December 31, 2018. Indicate the type and amount of any balances available for carry forward to subsequent years.