Problem
Karok Levine has provided you with the following information pertaining to the 2020 tax year:
1. The financial statements for Karok's dental practice report a net income of $110,000.
2. Amortization of $15,000 is reported in the expenses.
3. Capital cost allowance has been accurately calculated at $12,500 and has not been accounted for in the financial statements.
Karok conducted scientific research and experimental development (SR&ED) in 2020. $40,000 of the expenditures are qualified SR&ED activities. These costs are currently reported as capital items on the balance sheet.
Karok has a small hobby farm in the country, which recognized a loss of $9,000 in 2020.
Task
Calculate Karok's minimum net income for tax purposes for 2020.