Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

nit: 2:00:00 Since 2015, Stan Walter has been employed as an internal auditor by MacNeil Industries Inc. (MII), a public corporation. Stan travels from head

image text in transcribed
image text in transcribed
nit: 2:00:00 Since 2015, Stan Walter has been employed as an internal auditor by MacNeil Industries Inc. (MII), a public corporation. Stan travels from head office to MMI's three branch locations to perform audits. The following amounts were paid to Stan Walter (or on his behalf) in 2020 by MII. $90,000 2,400 375 Net salary (net of $28,000 payroll deductions) Monthly travel allowance - $ 200 per month Fees for the preparation of Stan's income tax return Annual health club membership fees Christmas gift - Best Buy Gift card Registered Pension Plan contributions Group term life insurance premiums - Sun Life Group disability insurance premiums - Sun Life 800 250 1,250 500 The following amounts were withheld from Stan's salary as payroll deductions by Mll, or paid by Stan during the year: 350 Employment insurance Canada Pension Plan Income taxes Registered Pension Plan contributions Payroll deductions Employment related travelling expenditures: $1,198 2,898 21,704 2,200 $28,000 2:00:00 2,300 1,400 Employment related travelling expenditures: Accommodations Meals (consumed while out of metropolitan area greater than 12 hours) Gifts - given to plant managers by Stan 250 Mll provided Stan with a passenger vehicle for all of 2020. It was acquired by MII on March 1, 2019 for $60,000 (including 13% HST). MII paid operating costs of $3,750 and claimed $5,594 capital cost allowance for the year. At December 31, 2020 the book value of the vehicle was $29,400 and the fair market value of the vehicle was $40,000. Stan drove the vehicle a total of 35,000 km and employment related travel was 22,000 km. Stan reimbursed MII 10 cents per km for personal travel. In March 2020 Stan exercised his stock options to purchase 4,000 common shares from Mll for $13 when the market value of the shares was $18. The options were provided to Stan by Mll three years ago when the shares were trading at $12. Mil allows employee pricing on items they manufacture. Stan purchased a MIl sound system in August 2020 for $1,000. The market price of the item was $2,200 and the cost to MlI was $1,500. Required: Compute Stan Walter's 2020 income from employment for tax purposes based upon the above information. State any reasonable assumptions you feel it is necessary to make. Where amounts are not included in your income calculation, provide a brief explanation why the amount was not included in your calculation. nit: 2:00:00 Since 2015, Stan Walter has been employed as an internal auditor by MacNeil Industries Inc. (MII), a public corporation. Stan travels from head office to MMI's three branch locations to perform audits. The following amounts were paid to Stan Walter (or on his behalf) in 2020 by MII. $90,000 2,400 375 Net salary (net of $28,000 payroll deductions) Monthly travel allowance - $ 200 per month Fees for the preparation of Stan's income tax return Annual health club membership fees Christmas gift - Best Buy Gift card Registered Pension Plan contributions Group term life insurance premiums - Sun Life Group disability insurance premiums - Sun Life 800 250 1,250 500 The following amounts were withheld from Stan's salary as payroll deductions by Mll, or paid by Stan during the year: 350 Employment insurance Canada Pension Plan Income taxes Registered Pension Plan contributions Payroll deductions Employment related travelling expenditures: $1,198 2,898 21,704 2,200 $28,000 2:00:00 2,300 1,400 Employment related travelling expenditures: Accommodations Meals (consumed while out of metropolitan area greater than 12 hours) Gifts - given to plant managers by Stan 250 Mll provided Stan with a passenger vehicle for all of 2020. It was acquired by MII on March 1, 2019 for $60,000 (including 13% HST). MII paid operating costs of $3,750 and claimed $5,594 capital cost allowance for the year. At December 31, 2020 the book value of the vehicle was $29,400 and the fair market value of the vehicle was $40,000. Stan drove the vehicle a total of 35,000 km and employment related travel was 22,000 km. Stan reimbursed MII 10 cents per km for personal travel. In March 2020 Stan exercised his stock options to purchase 4,000 common shares from Mll for $13 when the market value of the shares was $18. The options were provided to Stan by Mll three years ago when the shares were trading at $12. Mil allows employee pricing on items they manufacture. Stan purchased a MIl sound system in August 2020 for $1,000. The market price of the item was $2,200 and the cost to MlI was $1,500. Required: Compute Stan Walter's 2020 income from employment for tax purposes based upon the above information. State any reasonable assumptions you feel it is necessary to make. Where amounts are not included in your income calculation, provide a brief explanation why the amount was not included in your calculation

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions

Question

Distinguish between operating mergers and financial mergers.

Answered: 1 week ago