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In 2021, Landscaping Limited incurred $200,000 of qualified scientific research and experimental development expenditures eligible...

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Accounting

In 2021, Landscaping Limited incurred $200,000 of qualified scientific research and experimental development expenditures eligible for the 15% investment tax credit. The corporations federal income tax rate after the abatement and the general rate reduction is 15%. Its taxable income before the deduction of the SR&ED expenditures under section 37 is $300,000.

The corporation is not eligible for any other tax credits and paid no tax in the preceding three years.

REQUIRED

(1) What is the maximum investment tax credit available?

(2) Compute the net federal Part I tax payable after the investment tax credit.

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