During the year ending December 31, 2019, Durham Inc. had GAAP based accounting income before taxes of $427,000. The corresponding figure for 2020 was an accounting loss of $625,000. Included in these figures were the following amounts: The above accounting gains (losses)on the sale of shares are equal to the capital gains (losses)on the sale of the shares.
At the beginning of 2019, Durham had available a non-capital loss carry forward of $26,000 and a net capital loss carry forward of $19,000 [(1/2)($38,000)]. It is the policy of Durham to minimize non-capital loss carry overs.
Required: Calculate the minimum Net Income For Tax Purposes and Taxable Income for each of the two years 2019 and 2020 and indicate the amount and type of any carry overs that are available at the end of each year.

Question

During the year ending December 31, 2019, Durham Inc. had GAAP based accounting income before taxes of $427,000. The corresponding figure for 2020 was an accounting loss of $625,000. Included in these figures were the following amounts:  The above accounting gains (losses)on the sale of shares are equal to the capital gains (losses)on the sale of the shares.
At the beginning of 2019, Durham had available a non-capital loss carry forward of $26,000 and a net capital loss carry forward of $19,000 [(1/2)($38,000)]. It is the policy of Durham to minimize non-capital loss carry overs.
Required: Calculate the minimum Net Income For Tax Purposes and Taxable Income for each of the two years 2019 and 2020 and indicate the amount and type of any carry overs that are available at the end of each year.

Quizplus · Accepted Answer

The Answer of During the year ending December 31, 2019, Durham Inc. had GAAP based accounting income before taxes of $427,000. The corresponding figure for 2020 was an accounting loss of $625,000. Included in these figures were the following amounts:  The above accounting gains (losses)on the sale of shares are equal to the capital gains (losses)on the sale of the shares.
At the beginning of 2019, Durham had available a non-capital loss carry forward of $26,000 and a net capital loss carry forward of $19,000 [(1/2)($38,000)]. It is the policy of Durham to minimize non-capital loss carry overs.
Required: Calculate the minimum Net Income For Tax Purposes and Taxable Income for each of the two years 2019 and 2020 and indicate the amount and type of any carry overs that are available at the end of each year.

During the Year Ending December 31, 2019, Durham Inc