Ms$.$ Debbie, the sole shareholder and president of Shining Ltd$.($a CCPC$)$ has been considering selling all her shares to Deal Ltd$.($a public corporation$).$ She is also considering an alternative $$ selling the assets of Shining Ltd$.$ instead and winding up the corporation herself. Ms$.$ Debbie has used up all her capital gains exemption in prior years. It is now January $1,2023.$

Ms$.$ Debhic has provided you with the following information:

The cost of Ms$.$ Debbie's couwnoo shares was $$120,000$

The coporate tax rate $($combining federal and poovizcial rates together$)$ is $13\%$ for the

first $$500,000$ of busizess income, $27\%$ co additional business incouse, and $50\mathrm{.}6\%\%$ for

investneat incone.

Ms$.$ Debbie's personal tax rate $($federal $+$ provincial combined$)$ is $50\%.$

Shining Ltd$\text{'}$s financial iaformation on Jamuary $1,2023$ is as follows:

Deal Lid. plans to acquire Shining

l$.$td$.\text{'}$s assets or shares with the inteation of continuing the

business.

The company has a $$48,000$ capital dividend account on December ${31}^2,2022.$ They have

$$10,000$ of GRIP and no RDTOH balance at the beginning of the year.

REQUTRED

a$)$ Deteruine the cash that Ms$.$ Debbie would retain, after taxes, if she decides to sell the

corporate assets, wind up the corporation, and distribute the corporate cash to herself.

b$)$ What is the mizimum anount that Deal

l$.$td$.$ would have to offer for Ms$.$ Debhie's shares

that would lead io her accepting a share purchasse as opposed to an asset parchase?

c$)$ If Ms$.$ Debbie were to sell her shares to Deal Lid., is there arything she can do prior to

sale to maximize the after$-$tax cash she will receive? $($Fritz$.$ Deal

l$.$td$.$ is a public

corporation, and thus canot we the capital dividend account$)$