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Darren ltd. has a December 31 year end. For the current year, the company reported net...

Darren ltd. has a December 31 year end. For the current year, the company reported net income before tax for accounting purposes, determined under generally accepted accounting principles, of $682,000. Darren has an investment in Lake Inc. that is accounted for using the equity method. Current-period equity income is $65,000, and dividends received on this investment in the year were $43,500. In the current year, Darren also received dividends from taxable Canadian corporations of $3,700 on portfolio investments and foreign dividends of $4,600. Darren's capital cost allowance claim for the year is equal to amortization expense reported in the income statement.

For the current year, what amount will Darren report as net income for tax purposes and taxable income?

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Answer #1

Net income b/f tax

6,82,000.00

Equity Income

     65,000.00

Dividends received on this investment

     43,500.00

Dividends on profolio investments

       3,700.00

Foreign dividends

       4,600.00

NET INCOME FOR TAX PURPOSES/YEAR :   

7,98,800.00
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