Rouge Ltd$.$ is a Canadian controlled private corporation that is associated with another corporation during the current year. In the current$$ year, Rouge Ltd$.$ is allocated$$ $$100,000$ of the annual business$$ limit$,$ which is the figure used to calculate the small business deduction for the corporation in the current year. Rouge Ltd$.$ primarily earns income from manufacturing and processing activities. In the current$$ year, Rouge Ltd$.$ has net income for tax purposes of$$ $$152,000.$ This income is comprised of the following$$ amounts:

bullet Manufacturing$$ & processing profits $$$$122,000$

bullet Dividend income from taxable Canadian corporations $$$ $20,000$

bullet Canadian source interest income $$$ $10,000$

Which of the following is the correct Manufacturing$$ & Processing Profits Deduction for Rouge Ltd$.$ in the current$$ year?

Question content area bottom

Part $1$

A$.$

$$$$17,160$

B$.$

$$$$1,300$

C$.$

$$$$2,860$

D$.$

$$$$3,900$