Zara Kim is the owner of two residential rental properties, 209 Old Monk Avenue, and 12 James Street. These properties were purchased six years ago for $525,000 and $600,000, respectively. In the current year, 209 Old Monk Avenue was sold for $850,000. A reasonable allocation of this amount is considered to be 75% to the building and 25% to the land. The following income and expenses were incurred in renting out the two properties in the current year:

Rental . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 80,000

Interest on mortgage . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . (50,000)

Operating costs . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . (25,000)

Promotion costs for sale of property . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,000)

Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 0

There are no meal or entertainment expenses included in the $5,000 of sales promotion costs. The opening undepreciated capital cost of 209 Old Monk Avenue was $383,500 and that of 12 James Street was $480,000.

Required: Zara has asked you to determine her income from the property, assuming she wishes to report the least amount possible for tax purposes in the current year. (Building CCA Class 1-4% CCA rate)