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The income statement for Jolly Good Marketing Ltd., is as follows:

Jolly Good Marketing Ltd. (JGML)
Income Statement Ending October 31, 20X1
Sales Revenue			$625,000
Less: Cost of Goods Sold			230,000
Gross Profit			$395,000
Operating Expenses:
	Salaries and Wages	$127,000
	Property taxes	24,000
	Amortization expense (see Note 1)	48,000
	Charitable donations	4,800
	Recreation club membership fees	14,400
	Meals and Entertainment (see Note 2)	29,000
	Repairs and Maintenance (see Note 3)	35,000
	Other operating expenses	67,000	349,200
Operating income			$45,800
Other revenue and expenses:
	Gain on sale of equipment	$12,000
	Loss on sale of furniture	(4,000)
	Interest revenue	2,450
	Dividends from taxable Canadian corporations	6,300	16,750
Income before taxes			$62,550
	Income tax expense		8,760
INCOME AFTER TAXES			$53,790

NOTE 1: Assets

Assets	Cost	NBV	UCC
Land	$750,000	$750,000
Building	$625,000	$531,250	$553,000
Furniture and equipment	$376,000	$264,000	$212,000
Delivery vans	$254,000	$186,000	$124,000

In 20X1, JGML disposed of old and worn-out furniture. No proceeds were received as the furniture was disposed. The original cost of the disposed furniture was $4,000.

In 20X1, JGML sold equipment for $61,000. The original purchase price of the sold equipment was $49,000.

In 20X1, JGML purchased new equipment and furniture for $63,000.

NOTE 2: Meals & Entertainment

Meals and Entertainment expenses of $29,000 included $1,000 for the JGML Christmas party. The remainder was spent while entertaining clients.

NOTE 3: Repairs & Maintenance

The Repairs & Maintenance expenses of $35,000 includes $30,000 expense for upgrading the floor in the lobby. The remainder was for servicing equipment and painting.

NOTE 4: Losses

JGML has the following losses available

	NET CAPITAL LOSS	$8,000
	NON-CAPITAL LOSS	$12,000

These losses were incurred in the prior periods and are available (if applicable) to be used in 20X1.

REQUIRED:

ASSIGNMENT 1: CCA Schedule

Using an Excel workbook, prepare the CCA schedule in good form for JGML You may use the vertical format as in the textbook or the Excel template provided to you. Alternatively, you can use CRAs Schedule 8.

ASSIGNMENT 2: Reconciliation Schedule

Using an Excel workbook, prepare the Reconciliation Schedule in good form for JGML.

For example, for format see SSP 6-11 Solution on page S-128 in the Study Guide.

ASSIGNMENT 3: Taxable Income and Loss Carryover Amounts

Using an Excel workbook, showing your work, calculate JGMLs taxable income and the remaining balances in their loss carryover pools.

CLASS CLASS CLASS TOTAL CCA RATE UCC Beginning so 0 0 (+) Additions Accelerated Investment Incentive - ELIGIBLE PROPERTY (EP) Accelerated Investment Incentive- NON-ELIGIBLE PROPERTY (NEP) Disposals: Lesser of: Cost (ii) POD Net add (disp) Adjusted UCC after addition and disposutions Add: Acc: = 50% (EP - dispostion - NEP) Half Year Rule (12 X (NEP- disposition) (-) UCC before CCA Recapture Terminal loss CCA Deduction (+) Half Year Rule (=) UCC ENDING

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