Question 7 (5 points) Rakita Inc. reported earnings before income tax of $705,000 in 2020. During the year, the company recorded expenses for political contributions of $16,000; interest and penalties expense for late payment of a tax instalment of $4,000; warranty expense of $75,000 and; repairs expense of $74,000. Included in revenue were dividend income of $9,000; interest income of $18,000; a gain of sale of land of $114,000 and; revenue from a long-term receivable of $305,000. Actual warranty claims paid were $35,200, CCA for 2020 is $104,000 and, the dividend income was received from another tax-paying Canadian Corporation. Capital gains are taxable at 50% and political contributions are not a tax deductible expense. The long-term receivable is taxable when collected and collections in 2020 amounted to $150,000. Rakita's tax rate in 2020 is 42% Required: Calculate taxable income and income tax payable. (5 marks)