Problem 15-1 (Past exam question: 18 minutes) (Text: Ch. 12, 15) It is now December 31, 2016. Recently, Mr. X received an offer from a U.S. multi-national to purchase his company, XYZ Limited. It is planned that the sale will close on March 1, 2017, the day after the corporation's normal year-end. XYZ Limited is 100% owned by Mr. X and is a CCPC. Prior to the sale, Mr. X would like to pay himself the maximum available capital dividend. The corporation previously paid out a capital dividend in the amount of $50,000 on March 31, 2013, after receiving a capital dividend of the same amount from a related corporation. On December 1, 2015, it sold a licence with an unlimited life for $300,000. The company has disposed of the following capital assets since its inception: Date Description Cost Proceeds January 31, 2013 Land $115,000 $175,000 February 14, 2013 Equipment 15,000 4,500 February 28, 2016 Securities 31,500 22,500 XYZ Limited has also accepted an offer to sell vacant land for $290,000. The transaction is expected to close on January 31, 2017. The original cost of the land was $485,000. The land is capital property. Mr. X would like to ensure that the company pays out a taxable dividend sufficient to clear the balance in the company's refundable dividend tax on hand (RDTOH) account. During the tax year, XYZ Limited received $10,000 in dividends from taxable Canadian corporations and $15,500 in interest income. Mr. X is suspicious of foreign banks and, therefore, invested all of the company's surplus funds in Canada. XYZ Limited has always maintained a policy of declaring a bonus to reduce active business income to the small business deduction limit $500,000 for 2016. Mr. X has determined Part I tax payable for the year to be $60,374. The company has never had any additions to its cumulative eligible capital account. Required: Part A (13 minutes) Calculate the balance expected to be in the company's capital dividend account on February 28, 2017. Show all calculations. On what date should the company pay out the capital dividend? Explain.