1.B Inc. purchased a $20,000 bond on its issue date, October 1, 2020. The bond pays interest at maturity, September 30, 2023, at a rate of 4% compounded annually. B Inc. has a December 31 year end....

1.B Inc. purchased a $20,000 bond on its issue date, October 1, 2020. The bond pays interest at maturity, September 30, 2023, at a rate of 4% compounded annually. B Inc. has a December 31 year end. What amount of interest must be included in income for 2020?





2.E, an individual, received $10,000 of non-eligible dividends from Canadian corporations in the current year. What amount is included in E’snet incomefor tax purposes for the current year?


3.G Inc. received $20,000 of eligible dividends from Canadian corporations in the current year. What amount is included in G’snet incomefor tax purposes for the current year?


4.D sold capital property in the current year for net proceeds of $600,000. The property has an adjusted cost base of $150,000. B received $80,000 at the time of the sale and a note for the balance to be paid in equal annual instalments over the following eight years. What is the minimumtaxablecapital gain to be reported in the current year?


5.D sold a depreciable asset for $40,000. It was the only asset in the capital cost allowance class. The undepreciated capital cost was $55,000 at the time of the sale. The asset cost $60,000 when it was purchased. What is the amount of the loss to be reported in net income for tax purposes in the year of sale?


6.E sold her home for $340,000. She purchased the home for $350,000 and made capital improvements to the home costing $50,000. What is the amount of the loss to be reported innet incomefor tax purposes?


7.G sold 1,000 shares of Need Ltd. for $8,000 early in the current year. The adjusted cost base of the 1,000 shares sold was $24,000. Two weeks later, the value of Need Ltd. started rising and G purchased 700 shares which he still owns at the end of the year. What is the amount of theallowable capital loss?


8.M acquired a home in 2013 for $350,000 and a cottage in 2017 for $250,000. In 2020 M sold the home for $800,000 and the cottage for $550,000. What is the minimum amount to be reported innet incomefor tax purposes in 2020?


9.
B had earned income of $100,000 in 2019 and $80,000 in 2020. At the end of 2019 their pension adjustment was $5,000 and their unused RRSP deduction room was $2,000. What is B’s maximum RRSP deduction in 2020?


10In 2020 C had the following incomes and deductions: Salary $80,000, employment benefits $3,000, interest income $1,000, net rental income $6,000, child-care deduction $4,000, and a business loss of $15,000. What is C’s earned income for RRSP purposes for 2020?


11In the current year D withdrew $18,000 from his spousal RRSP and $7,000 from his TFSA. His spouse had contributed $2,000 to the plan in each of the last six years but not in the current year. What amount is included in D’s income for tax purposes in the current year?


12M incorporated a business and allocated some of the shares to her 10 year-old child. The child paid for the shares with funds received from a grandparent’s estate. During the current year the child received dividends of $5,000 from the corporation but has no other income. These dividends are taxable at the highest marginal tax rate. Is this statement true or false?


13.In the year of his death, J owned a rental property – land (FMV $350,000; cost $300,000), building (FMV $400,000; cost $320,000; UCC $250,000). In his Will, he bequeathed the property to his daughter. What amount is added to J’s taxable income in the year of death?