Tax rates and general information: Personal Individuals: tax rate George (Father) 55 years old 50% Mary (Mother) 55 years old 50% Sheldon (Son) 32 years old 50% Amy (Daughter in Law) 35 yrs. old 50% Leonard (Son in Law) 35 yrs. old 50% Missy (Daughter) 32 years old 25% CGE Room Occupation $866,912 High School Phys Ed Teacher $0 Bookkeeper, investor $866,912 Professor-Geology $866,912 Professor-Microbiology S866,912 Professor-Engineering $866,912 Stay at Home Mom Dividend Gross up rates: Eligible Dividends: 38% Non-Eligible Dividends: 15% Dividend Tax credit is assumed equal to the Gross up. Corporations: CCPC eligible for the Small Business Deduction: 13% CCPC not eligible for the Small Business Deduction: 50.67% Corporations not eligible for Small Business Deduction: 28% Corporations classified as a Personal Service Business: 33% A family has come to you seeking a new accounting fimm. Their previous accountant was the firm of Dewey, Cheatem and Howe (DCH). DCH charged them exorbitant fees and provided them with little in the way of service. The family was tired of working with a different staff accountant every year at DCH and they desired to have more direct contact with the person who was handling their tax and accounting affairs. The family group has numerous business interests. They are looking for someone to provide tax advice for them on several separate tax issues. They have provided you with all the relevant information for you to review the family's financial affairs. The information below summarizes that information provided to you. Information been provided for you explaining the family relationships and other relevant information for you to use in the completion of your assignment. address the tax implications of the situations described below. To begin with you reviewed the information and financial statements of Hoedad Inc., a Canadian- controlled private corporation with a May 31 year end. The shares of Hoedad are entirely owned by George. In your review, for the fiscal period ended May 31, 2020, you notice the following transactions. 1. On July 4, 2019, Hoedad made a loan of $24,000 to Leonard, the son in law of the sole shareholder, George. This loan bears no interest, and there are no terms of repayment attached to it. Leonard used the money to purchase a residence that he inhabits. 2. On May 31, 2020, Hoedad declared a bonus totaling $200,000 to its managers and employees under the company's annual policy designed to reduce income to the amount of the annual business limit. George has expressed an interest in retiring from his regular job as a high school teacher. To do so George would like to redeem some of his interest in Hoedad. Hoedad wants to purchase 5,000 Class B preferred shares held by George for $500,000 (S100 per share). These shares were issued in a rollover of property to the corporation under subsection 85(1). The fair market value of the property transferred by George in the rollover was $505,000 and the agreed amount on the rollover form T2057 was $5,000. The consideration received by George consisted of $5,000 in cash and 5,000 Class B preferred shares. The legal stated capital entered in the corporate books on the issuance of the shares is $500,000. Those shares are qualified small business corporation shares. Hoedad currently has a capital dividend account of $200,000 and has no general rate income pool. George would like you to explain the tax consequences of the transactions above. He would also like you to provide recommendations regarding the items identified above to reduce the immediate or eventual tax consequences. Tax rates and general information: Personal Individuals: tax rate George (Father) 55 years old 50% Mary (Mother) 55 years old 50% Sheldon (Son) 32 years old 50% Amy (Daughter in Law) 35 yrs. old 50% Leonard (Son in Law) 35 yrs. old 50% Missy (Daughter) 32 years old 25% CGE Room Occupation $866,912 High School Phys Ed Teacher $0 Bookkeeper, investor $866,912 Professor-Geology $866,912 Professor-Microbiology S866,912 Professor-Engineering $866,912 Stay at Home Mom Dividend Gross up rates: Eligible Dividends: 38% Non-Eligible Dividends: 15% Dividend Tax credit is assumed equal to the Gross up. Corporations: CCPC eligible for the Small Business Deduction: 13% CCPC not eligible for the Small Business Deduction: 50.67% Corporations not eligible for Small Business Deduction: 28% Corporations classified as a Personal Service Business: 33% A family has come to you seeking a new accounting fimm. Their previous accountant was the firm of Dewey, Cheatem and Howe (DCH). DCH charged them exorbitant fees and provided them with little in the way of service. The family was tired of working with a different staff accountant every year at DCH and they desired to have more direct contact with the person who was handling their tax and accounting affairs. The family group has numerous business interests. They are looking for someone to provide tax advice for them on several separate tax issues. They have provided you with all the relevant information for you to review the family's financial affairs. The information below summarizes that information provided to you. Information been provided for you explaining the family relationships and other relevant information for you to use in the completion of your assignment. address the tax implications of the situations described below. To begin with you reviewed the information and financial statements of Hoedad Inc., a Canadian- controlled private corporation with a May 31 year end. The shares of Hoedad are entirely owned by George. In your review, for the fiscal period ended May 31, 2020, you notice the following transactions. 1. On July 4, 2019, Hoedad made a loan of $24,000 to Leonard, the son in law of the sole shareholder, George. This loan bears no interest, and there are no terms of repayment attached to it. Leonard used the money to purchase a residence that he inhabits. 2. On May 31, 2020, Hoedad declared a bonus totaling $200,000 to its managers and employees under the company's annual policy designed to reduce income to the amount of the annual business limit. George has expressed an interest in retiring from his regular job as a high school teacher. To do so George would like to redeem some of his interest in Hoedad. Hoedad wants to purchase 5,000 Class B preferred shares held by George for $500,000 (S100 per share). These shares were issued in a rollover of property to the corporation under subsection 85(1). The fair market value of the property transferred by George in the rollover was $505,000 and the agreed amount on the rollover form T2057 was $5,000. The consideration received by George consisted of $5,000 in cash and 5,000 Class B preferred shares. The legal stated capital entered in the corporate books on the issuance of the shares is $500,000. Those shares are qualified small business corporation shares. Hoedad currently has a capital dividend account of $200,000 and has no general rate income pool. George would like you to explain the tax consequences of the transactions above. He would also like you to provide recommendations regarding the items identified above to reduce the immediate or eventual tax consequences