Royal West Airlines Ltd. Income Statement For the Year Ended December 31, 2020 Sales revenue $2,561,096 Cost of sales (1,003,860) Gross margin $1,557,236 Other expenses ( 890,743) Net income, before income tax $ 666,493 Royal West Airlines is a regional airline that services Western Canada. Notes: a) $10,000 in legal fees relating to the restructuring of a debt. b) A brand new airplane costing $65,000 used to service a new route c) Interest on late municipal tax balances of $1,000 d) Sponsorship of a local musical production costing $9,240 e) Convention that was held in Barcelona, Spain costing $3,300 f) Interest expense of $4,000 that was associated with the acquisition of a GIC g) Cost of sponsoring local hockey teams $500 h) Food and entertainment for clients $60,000 i) Life insurance premiums on the life of the president (required by the bank) $2,000 Item 1. During the year the Company spent $6,500 for landscaping its head office grounds. For accounting purposes this cost was deducted in the year Item 2. The Other Expenses account included the following amounts: Item 3. The Other Income and losses account included the following amount: $32,000 spent on a staff Christmas party where all employees were invited to attend the event. Item 6. All of Royals remaining capital assets are Class 1 which related to an office building that was purchased in 2019. The UCC at the beginning of 2020 was $625,100. On July 1, the Company added an additional room for $20,000. No Class 1 assets were disposed of in the year. Item 5. In 2020, the Company deducted $21,000 bad debt expense based on a review of specific accounts. Item 4. For tax purposes, the machinery that was sold was a Class 10 asset. All assets in class were disposed of. The machinery was purchased for $15,000 and its UCC balance at the beginning of 2020 was $10,250. The asset was sold in 2020 for $14,600. Required: Complete the table below and show the adjustments that would be required in Royal West Airlines 2020 SCHEDULE 1 for each item listed in the question. For each item, show whether it adds to NITP by marking + in the appropriate column, a - mark if it subtracts from NITP, and a na mark if it is not applicable. Description Addition (+) Subtraction (-) (na) $ amount Citation Net Income for accounting $666,493 9(1) Item 1. Item 2. a) b) c) d) e) f) g) h) i) Item 3. Item 4. Item 5. Item 6.