U.P.I. Industries Ltd., a Canadian corporation with a head office in Nova Scotia, has recently been designated a public corporation. Its shares are traded on the TSX Venture Exchange. Over the past year, the company has pursued an aggressive expansion policy. Sales personnel based at head office have travelled to North Dakota and Minnesota and have achieved moderate success in developing new customers in the United States. In addition, the company has opened a branch location in Alberta by establishing an office and manufacturing plant staffed by new Alberta personnel. The Alberta manufacturing plant is the company's first venture into manufacturing.

Selected financial information for the company's current fiscal period is presented below.

1.

Profit Net Income for tax purposes Taxable income Net Income for tax purposes Taxable Income Allocate Income between Head office and Branch Taxable Income for Head Office - Nova Scotia Taxable Income for Alberta Total Taxable IncomeFederal Taxes Federal Basic tax Abatement General tax reduction Net Federal Tax Provincial Taxes Head Office - Nova Scotia Branch - Alberta Total Federal and Provincial TaxesHead office Alberta branch Canadian sales $9,317,000 $1,730,300 Foreign sales 850,000 -O- Cost of sales 6,149,200 1,211,200 Salaries and wages 1,597,200 266,200 Profit from operations 1,597,200 13,300 Dividend income 106,500 -0- Taxable capital gains 93,200 -O