The employee is a commission salesperson and the employer is a public company.

Receipts and Fringe Benefits

(a)Salary was $62,000 and commissions were $20,000.

(b)The employer paid the following amounts on the employee's behalf:

Private extended health care plan

400

Group term life insurance policy premium

600

Registered Pension Plan (RPP) - defined benefit

4,800

Group disability insurance premium

360

(c) Payroll deductions were as follows:

Income tax withheld

$23,000

Registered Pension Plan (RPP) - defined benefit

4,800

Canada Pension Plan premium

2,680

Employment Insurance premium

891

United Way donation to registered charity

500

Reimbursement for use of company car

1,800

(d)The employee was provided with a car, which was available throughout 2019. The car had cost $37,000, excluding GST, in 2017. Its fair market value at the beginning of 2019 was $25,000. The employee used the car in 2019 for employment purposes 70% of the time and drove a total of 30,000 kilometres during the year. The employer paid the operating costs of $4,000.

(e)The employer provided a companyowned apartment when the employee's home was flooded. The entire family stayed in the apartment for two months. Rent in this building for a similar unit was $1,000 per month.

(f)The employer paid a travel allowance of $12,000 for the year.

The employer requires the employee to pay the travel expenses and provided a T2200.The travel costs amounted to the following, which include GST:

Meals and Entertainment

$8,000

Accommodation

6,000

(g)The employer gave the employee a cash birthday gift of $500.

(h)The employee was permitted to participate in the corporation's stock option plan. In 2016, the employee was granted an option to purchase 2,000 shares at $12 per share. At that time, the shares were valued $10. The employee exercised the option to buy 500 shares in 2019 at a time when they were valued at $15 per share.

(i)The employee paid the principal only (no interest) to the employer on January 15, 2019 on a $10,000 loan for unanticipated expenses. This paid off the loan in full. The employee took out the loan on April 2, 2018 (assume that the prescribed rate for 2018 & 2019 was 3%, throughout both year).

(j)The employee paid membership dues of $520, including GST, for membership in the Canadian Association of Professional Salespersons, a professional body recognized by legal statute.

(k)The employees's life partner accompanied the employee on a business trip to Cuba that was paid for by the employer. The life partner performed no business function during the trip. They did not extend their trip to include a vacation. The employee's expenditures of $7,000, including applicable taxes, were paid by the employer and the portion of the travelling expenses related to the employee's life partner were also paid by the employer and amounted to $2,000, including applicable taxes.

(l)... In May 2019, the employee was in an accident on the job and was unable to work for 2 months. During this period, the employee received disability payments totalling $8,400 from the company insurance plan. The employee has not received any previous payments under this plan and has paid total premiums of $3,600 into the plan since the employee began employment including the 2019 premiums.

(m)To help develop and maintain clientele for employer, the corporation paid $3,000 for a membership at the Curling Club.

REQUIRED: Show all calculations for full marks.

Part A: Determine the amount of the employee's net employment income for 2019. Show all aspects of the required calculations.

Part B:Determine any of the above amounts that you consider to be inapplicable to the net employment income calculation. Be sure to comment on all items not used in your computation of employment income.