You have been assigned to the audit team for B.B. JAMS Ltd., one of your significant clients. Below is the income statement prepared by the company's accountant for the December 31, 2022, year end. Through various discussions with the accountant, you have been able to determine that the following information has been recorded in the financial statements: (1) JAMS had a number of items of inventory that did not sell well in the current year. For accounting purposes, the accountant has recorded a reserve for inventory obsolescence. The reserve was calculated based on the carrying value of any inventory item that had not had a sale in the last 180 days. The reserve at year end was $1,285,000. (2) JAMS provides insurance for employees and paid the following amounts to Nat Insurance Company during the year: $2,000,000 insurance policy on the life of the president included in insurance expense ($300 per month) $1,000,000 insurance policy on the life of the vice-president - marketing Group term life insurance for employees included in salaries and benefits ($37,00012 months) 444,000 Total. . JAMS is the beneficiary of the policies on the president and vice-president. On June 1,2022 , JAMS renegotiated its bank debt, and due to the ever-increasing responsibilities of the president, the bank required the insurance policy on the life of the president as part of the collateral for the loan. The the policy. (4) During the year, there were substantial repairs completed to the outside of the puncung. nuver the repairs some of the landscaping had to be redone. The total costs were $139,000. Of this, $23,500 relates to the landscaping costs. The entire $139,000 was included in general and administrative expenses. (5) A review of the other expense accounts included in general and administrative expenses showed the following: - All of the amounts were paid in the year. (6) The salaries and benefits account shows contributions for certain employees to the company's registered pension plan. The contributions were not actually made until March 31, 2023. The pension plan is a defined contribution (money purchase) plan. The company matches the employees' contributions on a dollar-for-dollar basis. (7) In early November 2022, JAMS announced an early retirement package that was made available to employees over the age of 60 . In order to provide employees with the time required to assess the offer, the deadline for accepting the package has been set at February 15, 2023. While no formal replies were received as of December 31,2022, the personnel manager anticipates a high acceptance rate. She expects that the costs associated with the packages will be $672,000. This cost has been accrued in the 2022 financial statements. (8) The following information was taken from the various selling expense accounts: Cost of sponsoring presentations at a local theatre company Meals and entertainment costs of salespeople 8,0 (9) The other income includes a loss on the sale of various fixed assets of (10) During the year, the company had cash on hand for a short periof $35,900. tais rations on a dolar Least o Based on the information that you have obtained, your manager has asked you to calculate the income from business for tax purposes for JAMS for December 31, 2022. He also wants you to show all calculations whether or not they seem relevant to the final answer and comment on all items omitted from the calculation