Miller Entreprises

Income statement

For the year ended December 31. 2020

Income

Sales $ 635 000

Cost of sales 46 000

Opening inventory 252 000

Purchases 298 000

Closing inventory 66 000 232 000

Gross profit 403 000

Expenses

Accounting and legal (note 2) 4200

Advertising and promotion (Note 3) 5400

Depreciation (note4) 25 800

Automobile expenses 7600

Bad debts ( note 5) 3200

Insurance (note 6) 8 000

Interest 19400

Office expenses (note7) 12 500

Rent 37 000

Wages and benefits (note 8) 112 000 235 100

Net income $ 167 900

1. Miller enterprises is a small business corporation operated by the sole shareholder . Mileer Cameron
2. Accounting and legal includes legal fees related to Camerons dispute in regards to a personal car accident in the amount of $ 1920.
3. Advertising and promotion includes "Meals and Entertainment" costs in the amount of $ 4290.
4. Information for Capital Cost Allowance purposes -the UCC at december 31 of the prior year was as follows:

Class 8 ( office & equipment) : $ 45 250

Class 10 $ 24 200

5.The company has set up an allowance for doubtful accounts based on a review of the Accounts Receivable at December 31 of the current year.

6.Insurance includes life insurance premiums for Cameron Miller in the amount of $

$ 2400. This life insurance policy is required as collateral for the business bank loan.

7.Office expenses include the $ 6000 purchases of laptop computers on January 15,2020.

8.. Wages and benefits includes the club dues/membership fees paid to the Royal Club in the amount of $ 5960. The club dues are paid for the five managers who take clients to the Royal Club on a regular basis for the business purposes.

Calculate the Net business income. (step by step)