1 Polytech Inc calculated its Net Income for its Dec 31st, 2019, year end as follows Revenues $1,000,000 Other income 100,000 A Expenses Cost of Goods Sold ($300,000) B Selling and Administrative Costs (150,000) C Amortization Expense (175,000) D Other Expenses (125,000) (750,000) E Income Before Tax Expense $350,000 Income Tax Expense (75,000) Net Income $275,000 Other Information A Other income consists of a capital gain B Cost of Goods Sold includes $ 15,000 in lower of cost or market adjustment C Selling and Administrative Costs include $ 30,000 in club memberships for senior management $ 1,000 in interest on late tax installments D Polytech Inc amortizes the following assets Building, 95 manufacturing use, 5 office use, with an ACB of $1 5 million and a UCC of $1 2 million on Jan 1, 2019 Warehouse leased in 2014 for a 10 year term with an option for two 5 year renewals Leaseholds improvements were made in 2014 for $100,000 and 2016 for $40,000 Manufacturing equipment (class 8) with a cost of $200,000 and a UCC on Jan 1 st , 2019, of $140,000 In December the company sold equipment for $500,000 which was originally purchased for $400,000 Replacement equipment was also purchased in December for $650,000 E Other Expenses include $ 4,000 in 2019 year end bonuses, paid on July 1 st , 2020 $ 2,000 in bond amortization $ 4,000 in incorporation costs A Calculate minimum Net Income For Tax Purposes for the year ended Dec 31, 2019 B End of year tax account balances and, C Explain adjustments to GAAP income and any amounts that are unadjusted 2 One of Polytech Inc s manufacturing facilities burned down in February of 2019 An insurance settlement of $1 5 million was reached in August 2019 In October 2019, Polytech commenced construction of a new building which was completed in March 2020 at a cost of $2 million The manufacturing facility had an ACB of $1 2 million and UCC of $0 9 million prior to the fire Polytech Inc will utilize the Replacement Property Rules Calculate the CCA for the year ended Jan 31, 2020, and tax balances

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1. Polytech Inc. calculated its Net Income for its Dec. 31st, 2019, year-end as follows: Revenues $1,000,000 Other income 100,000 A Expenses: Cost of Goods

1. Polytech Inc. calculated its Net Income for its Dec. 31st, 2019, year-end as follows:

Revenues $1,000,000

Other income 100,000 A

Expenses:

Cost of Goods Sold ($300,000) B

Selling and Administrative Costs (150,000) C

Amortization Expense (175,000) D

Other Expenses (125,000) (750,000) E

Income Before Tax Expense $350,000

Income Tax Expense: (75,000)

Net Income $275,000

Other Information:

1. A. Other income consists of a capital gain.
1. B. Cost of Goods Sold includes: $ 15,000 in lower of cost or market adjustment
1. C. Selling and Administrative Costs include:

- $ 30,000 in club memberships for senior management

- $ 1,000 in interest on late tax installments

1. D. Polytech Inc. amortizes the following assets:
-Building, 95% manufacturing use, 5% office use, with an ACB of $1.5 million and a UCC of $1.2 million on Jan. 1, 2019.
-Warehouse leased in 2014 for a 10-year term with an option for two 5-year renewals. Leaseholds improvements were made in 2014 for $100,000 and 2016 for $40,000.
-Manufacturing equipment (class 8) with a cost of $200,000 and a UCC on Jan. 1^st, 2019, of $140,000. In December the company sold equipment for $500,000 which was originally purchased for $400,000. Replacement equipment was also purchased in December for $650,000.
1. E. Other Expenses include:

-$ 4,000 in 2019 year-end bonuses, paid on July 1^st, 2020

-$ 2,000 in bond amortization

-$ 4,000 in incorporation costs

A. Calculate minimum Net Income For Tax Purposes for the year ended Dec. 31, 2019;
B. End of year tax account balances; and,
C. Explain adjustments to GAAP income and any amounts that are unadjusted.

2. One of Polytech Inc.’s manufacturing facilities burned down in February of 2019. An insurance settlement of $1.5 million was reached in August 2019. In October 2019, Polytech commenced construction of a new building which was completed in March 2020 at a cost of $2 million. The manufacturing facility had an ACB of $1.2 million and UCC of $0.9 million prior to the fire. Polytech Inc. will utilize the Replacement Property Rules.

Calculate the CCA for the year ended Jan. 31, 2020, and tax balances.