Rebeccas Delicious Delights (RDD) is a Canadian Controlled Private Corporation. It operates a store front bakery and also does some catering in Penticton, BC. Rebecca Chow, the manager and majority shareholder of RDD, has asked you to take a look at her current year financial information to help her determine how much money she will need to set aside for taxes. The financial statements, and other information, for the year ended December 31, 2021 are as follows:

Rebecca's Delicious Delights
Income Statement
For the Year Ended December 31, 2021
Sales					1,326,512
Cost of goods sold					(415,623)
Gross profit					910,889
Operating expenses
	Depreciation		104,500
	General and administrative		475,000
	Interest		60,000		(639,500)
Operating income					271,389
Other income
	Gain on sale of equipment				2,400
Income before taxes					273,789
Income taxes					(41,068)
Net income					232,721

Additional Information:

1. Rebecca doesnt believe in recording an allowance for bad debt in her financial statements and as such the $12,000 in bad debt expense included in the general and admin expense is for a specific account owed by a customer who went bankrupt. In 2020 RDD claimed a reserve for doubtful accounts of $9,000. After a review of outstanding accounts, Rebecca believes that the corresponding amount for the current year would be $11,000

2. The following amounts were included in the General and Admin Expense:

• $4,200 donated to Canadian Cancer Society, a registered Canadian charity
• Because of a rat infestation, Rebecca was forced to throw out baked goods that had a cost of $1,200 and a retail value of $6,500. She expensed the retail amount.
• As her shop is close to the border, Rebecca advertises on an Oroville, Washington State radio station. The station can be clearly received in Penticton and the ads are targeted at Penticton residents. The cost of these ads in 2021 was $800.
• When making deliveries out of town, Rebecca pays one of her employees 70 cents per kilometre to use their personal vehicle. In 2021 she paid this employee $3,010 for 4,300 km driven.
• During the year Rebecca spent $5,300 on lunch and dinner meetings with customers.
• Rebecca pays her 12 year old daughter $2,000 per month to clean up the bakery for four hours every Sunday. Because of other obligations her daughter only worked 42 Sundays throughout 2020, although she still received the full $2,000 every month. On the other 10 Sundays, Rebecca paid one of the other staff members $12 per hour to do the same job.
• During the year RDD spent $10,000 on legal fees to reorganize the share structure of the company. The full amount was expensed on the income statement.
• On July 1^st RDD purchased the exclusive right to produce Little Sallys Snack Cakes in Canada, a sugar cake that has sold very well in Australia, for the next 10 years. The agreement cost RDD $70,000, which was expensed on the current year financial statements.

3. During the year Rebecca was considering opening a second location in Kelowna. Upon hearing this, some of the other local bakeries paid RDD $50,000 to stay out of the central Okanagan. Not knowing the proper treatment for this payment, Rebecca recorded it as a deferred revenue liability.

4. Undepreciated capital cost balances on January 1, 2021 were as follows:
   • Class 8 (20%) $147,000
   • Class 10 (30%) 42,000

5. During the year RDD sold some kitchen equipment (Class 8) for $3,000. It had an original cost of $6,500 and a Net Book Value of $600.

6. Interest expense on the income statement includes $2,300 for late payment of income tax installments and $3,400 in interest on the business line of credit used to fund day to day operations.

Please advise Rebecca as to the companys Net Income for Tax Purposes for the year ended December 31, 2021.

You must use the reconciliation method.