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a Carl Kay is the vice-president of KM Ltd., Canadian-controlled private corporation located in Halifax, Nova Scotia. KM operates a real estate development business constructing and selling commercial buildings and residential apartments. Carl's 2020 financial transactions include the following: Carl received a salary of $104,500 from KM. From this amount, KM deducted El and CPP of $3,754 (includes CPP enhanced contributions of $166) and income tax of $19,000. The company provided him with a car that cost $35,000 and that has an undepreciated capital cost of $18,000. The operating costs of $3,000 were paid by KM. In 2020, Carl drove the car 20,000 kilometres, of which 9,000 kilometres was for employment purposes. contributed $4,000 on Carl's behalf to a deferred profit sharing plan. Although KM does not have a group life insurance plan, it paid Carl's personal life insurance premium of $1,100 (coverage - $75,000). KM During the year, Carl sold 1,100 shares of KM Ltd. for $10 per share. He had acquired the shares three years earlier for $6 per share as part of a company stock-option plan. At the time of purchase, the shares were valued at $7 per share. In 2020, Carl constructed a 10- suite apartment block. He sold the property in 2020 for $800,000, which was $200,000 more than the original land and building cost. He received $80,000 of the proceeds in cash, with the balance due in five annual instalments beginning in 2021. The property incurred a net rental loss of $7,700 (before amortization). a Carl sold his summer cottage for $99,000 after it was announced that waste disposal site would be developed in the area. He had purchased the cottage six years earlier for $120,000. a In 2017, Carl loaned $18,000 to Alloy Ltd., Canadian- controlled private corporation. All of the company's assets are used in an active business. The 2019 interest of $1,500, which Required: Calculate Carl's minimum 2020 net income for tax purposes, taxable income, and federal income tax. Segment A Employment income: Net Employment Income Business income: $ 0 Net Business Income $ 0 Property income: Net Property Income Segment B Taxable capital gains and Allowable capital losses $ 0 Segment B Sub Total allowed Segment C Segment D Net Income for Tax purposes Taxable income ew Prev 1 of 1 a Carl Kay is the vice-president of KM Ltd., Canadian-controlled private corporation located in Halifax, Nova Scotia. KM operates a real estate development business constructing and selling commercial buildings and residential apartments. Carl's 2020 financial transactions include the following: Carl received a salary of $104,500 from KM. From this amount, KM deducted El and CPP of $3,754 (includes CPP enhanced contributions of $166) and income tax of $19,000. The company provided him with a car that cost $35,000 and that has an undepreciated capital cost of $18,000. The operating costs of $3,000 were paid by KM. In 2020, Carl drove the car 20,000 kilometres, of which 9,000 kilometres was for employment purposes. contributed $4,000 on Carl's behalf to a deferred profit sharing plan. Although KM does not have a group life insurance plan, it paid Carl's personal life insurance premium of $1,100 (coverage - $75,000). KM During the year, Carl sold 1,100 shares of KM Ltd. for $10 per share. He had acquired the shares three years earlier for $6 per share as part of a company stock-option plan. At the time of purchase, the shares were valued at $7 per share. In 2020, Carl constructed a 10- suite apartment block. He sold the property in 2020 for $800,000, which was $200,000 more than the original land and building cost. He received $80,000 of the proceeds in cash, with the balance due in five annual instalments beginning in 2021. The property incurred a net rental loss of $7,700 (before amortization). a Carl sold his summer cottage for $99,000 after it was announced that waste disposal site would be developed in the area. He had purchased the cottage six years earlier for $120,000. a In 2017, Carl loaned $18,000 to Alloy Ltd., Canadian- controlled private corporation. All of the company's assets are used in an active business. The 2019 interest of $1,500, which Required: Calculate Carl's minimum 2020 net income for tax purposes, taxable income, and federal income tax. Segment A Employment income: Net Employment Income Business income: $ 0 Net Business Income $ 0 Property income: Net Property Income Segment B Taxable capital gains and Allowable capital losses $ 0 Segment B Sub Total allowed Segment C Segment D Net Income for Tax purposes Taxable income ew Prev 1 of 1