ompany. On July 1, 2021, she began to practise law as a sole proprietor from an office in her home. Required: Gloria would like you to calculate his Net Income for Tax Purposes (Division B income) for 2021. You should indicate why you did not include any of the above amounts in your answer. Show all your work to get full marks. At a recent meeting, you gathered the information provided in Exhibits I and II. EXHIBIT I Gloria Edwards Information Regarding Work at IBM and Law Practice 1. Gloria’s salary to June 30, 2021, was $80,750. From this, IBM deducted CPP and EI of $4,056, income tax of $21,000, and $600 for Gloria’s portion of the private group medical insurance premium. An additional premium of $400 was paid by IBM. Also, IBM paid the $700 premium for Gloria’s group term life insurance coverage of $100,000. Gloria also received a pro-rated amount under the company’s profit sharing plan of $2,000. Gloria also had deducted from her gross salary the following items: A private extended health and dental plans $350 which
ompany. On July 1, 2021, she began to practise law as a sole proprietor from an office in her home. Required: Gloria would like you to calculate his Net Income for Tax Purposes (Division B income) for 2021. You should indicate why you did not include any of the above amounts in your answer. Show all your work to get full marks. At a recent meeting, you gathered the information provided in Exhibits I and II. EXHIBIT I Gloria Edwards Information Regarding Work at IBM and Law Practice 1. Gloria’s salary to June 30, 2021, was $80,750. From this, IBM deducted CPP and EI of $4,056, income tax of $21,000, and $600 for Gloria’s portion of the private group medical insurance premium. An additional premium of $400 was paid by IBM. Also, IBM paid the $700 premium for Gloria’s group term life insurance coverage of $100,000. Gloria also received a pro-rated amount under the company’s profit sharing plan of $2,000. Gloria also had deducted from her gross salary the following items: A private extended health and dental plans $350 which
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Gloria Edwards is a consultant. For 10 years, until June 30, 2021, she had been employed by IBM Ltd., a national computer company. On July 1, 2021, she began to practise law as a sole proprietor from an office in her home.
Required: Gloria would like you to calculate his Net Income for Tax Purposes (Division B income) for 2021. You should indicate why you did not include any of the above amounts in your answer. Show all your work to get full marks. At a recent meeting, you gathered the information provided in Exhibits I and II.
EXHIBIT I Gloria Edwards Information Regarding Work at IBM and Law Practice
1. Gloria’s salary to June 30, 2021, was $80,750. From this, IBM deducted CPP and EI of $4,056, income tax of $21,000, and $600 for Gloria’s portion of the private group medical insurance premium. An additional premium of $400 was paid by IBM. Also, IBM paid the $700 premium for Gloria’s group term life insurance coverage of $100,000. Gloria also received a pro-rated amount under the company’s profit sharing plan of $2,000.
Gloria also had deducted from her gross salary the following items:
A private extended health and dental plans $350 which her coverage was 25% of the plan while her employer contributed the other 75%.
A registered pension plan: defined contribution 3% $4,700 (which the employer also contributed $4,700).
Dues to maintain her designation as a professional Consultant $1,875 with the Professional Consultant Society of Canada.
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