Mr. Big and his two companies were incorporated under the Canada business corporations Act. Since you are currently enrolled in Tax 2, the tax manager has asked you to complete the mandate based on the following information:

Mr. Big and his group of companies

Mr. Big

48 years old Canadian resident married with 2 adult children.

Receives a salary from Big stores Ltd.

Has previously utilized $100,000 of his lifetime capital gain deduction in 2012.

Big stores Ltd.

Owned 100% by Mr. Big. He owns 1,000 common shares which cost $1,000 upon incorporation.

Owns and operates two retail variety stores with 4 full-time employees.

Also provides administrative services to TooneyRama Inc. (an arms length company)

Selected Tax Information for Big store Ltd.

For the year-end December 31, 2021

Cost Market Value

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Accounts Receivable $22,000 $18,000

Investment in shares of the public company $100,000 $50,000

Inventory $13,460 $35,000

Investment in Big foot Ltd. (QSBC shares) $20,000 $20,000

Equipment - class 8 (UCC $ 14,000) $50,000 $6,000

Equipment class 10 (UCC $16,000) $100,000 $24,000

Land (used in business) $35,000 $55,000

Total assets $340,460 $208,000

Liabilities Capital stock 120,000

Retained earnings 1,000

Total 219,460

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340,460

Net Income from store sales 420,000

Recapture CCA on sale of Delivery trucks 132,000

Administrative service income from TooneyRama Inc. 50,000

Administrative service income from Big Foot Ltd. 30,000

Interest income from seasonal surplus cash 2,000

Interest income on long-term loan to Big Foot Ltd. 6,000

Gross interest, before withholding tax, on US long-term deposits 16,000

($1,200 US taxes withheld. All amounts in Canadian dollars)

Interest expense on money borrowed for investment purposes (2,000)

Dividends from Big foot Ltd. 19,200

Taxable capital gain on the sale of land (not business income) 45,000

Division B 718,200

Notes:

The following carry-forward amounts were taken from the tax records of Big Stores Ltd. As of January 1, 2021

Donations from December 31, 2017, $10,000

Net capital loss from December 31, 2011, $20,000

Noncapital loss from December 31, 2014, $50,000

NED RDTOH balance January 1, 2021 (NO DR last year) $60,000

ED RDTOH balance January 1, 2021 (NO DR last year) $0

GRIP balance on December 31, 2020, $0

Capital dividend account balance December 31, 2020, $2,000

Bigfoot Ltd.

Owned 80 % by big Stores Ltd.

Owns and operates a chain of repair shops.

The fiscal year-end of March 31, 2021, showed a non-capital loss of $ 30,000.

Paid a $24,000 NED in 2021, which resulted in a $4,000 divided refund

Required:

Calculate Taxable income and Part I tax liability and Part IV Tax for the 2021 fiscal year-end for Big stores Ltd and the balances at December 31, 2021, of all pertinent tax accounts (CDA, ED, and NED RDTOH, GRIP )

Show all the calculations whether or not necessary for the final answer.