Question 6 (24 Marks) The condensed before tax Income Statement for Proesa Incorporated for the year ending December 31, 2018, prepared from information included in its financial statements, is as follows: Sales $3,000,000 Cost Of Sales ( 1,570,000) Gross Margin $1,430,000 Other Expenses (Not Including Taxes) ( 755,000) Operating Income Before Taxes $ 675,000 Other Income And Losses 275,000 Income Before Taxes $ 950,000 Other Information: 1. During the year, the company spent $5,200 for landscaping its head office grounds. For accounting purposes this was treated as a capital expenditure, but was not amortized during the current year. 2. The Other Expenses (Not Including Taxes) account included the following amounts: Bond discount amortization $ 500 Interest on deficient corporate tax instalments 1,200 Penalty on late filed returns 200 Interest on late property taxes 300 Reserve for inventory declines 78,900 Cost of Canmore condo for shareholder use Property Taxes 6,000 Condo Fees 8,000 Insurance 1,000 Utilities 2,400 Interest paid on bonds issued 22,000 Amortization expense 36,500 Advertising costs: magazine distributed only in Jamaica 17,000 Mileage paid to manager for use of car (5000 km @ $1/km) 5,000 Charitable donations 19,100 Speeding tickets 900 Cost of sponsoring local hockey teams 2,300 Cost of advertising circulars (One-half have been distributed) 15,000 3. The Other Income and Losses account contains the following items: Damages paid for breach of contract $18,000 Loss from theft 2,800 Cost of appraisal of property to be sold 3,800