MC-Class-Property

MC-Class-Property - MULTIPLE CHOICE INCOME FROM PROPERTY 1....

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MULTIPLE CHOICE INCOME FROM PROPERTY 1. Through payroll deductions at work, David purchased a $2,000 Canada Savings Bond on November 1, 20X3. The payroll department deducted $211.28 per month from his pay for 10 months, commencing in November 20X3. When he cashed in the bond in 20X4, David received $200.00 interest. How much can David claim as a carrying charge in 20X4? (Assume interest is computed on a straight-line basis.) (a) $2,000.00 (b) $2,112.80 (c) $112.80 ( d) $90.24 (e) none of the above 2. Elizabeth’s father owns 10 rental properties in his own name. During 20X7 he acquired a plot of land in a desirable location on which he intends to construct another rental property when financing is secured. During 20X7 he incurred interest ($10,000) and property taxes ($1,000) related to this land purchase. Elizabeth’s father will: (a) deduct $11,000 on his net rental statement for 20X7 (b) add $11,000 to the cost of the land in 20X7 (c) establish a “Deferred Interest/Property Taxes” account and write-off the interest and taxes over 5 years (d) establish a “Deferred Interest/Property Taxes” account and write-off the $11,000 in the first year during which the property is generating rental income (e) none of the above 3. Rob and Mary have a joint bank account which earned $600 interest in 20X4. Mary deposited $7,000 of her own funds to the account, Rob $3,000. How much interest does each report as income in 20X4? (a) Rob $600; Mary none (b) Mary $600; Rob none (c) Mary $300; Rob $300 (d ) Mary $420; Rob $180 (e) none of the above
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4. Mr. X, whose net income for tax purposes is $100,000 before interest income is reported, gave $200,000 10 per cent bonds to his wife on January 1, 20X4 for no consideration. His wife has no income for tax purposes. In 20X4 Mr. X: (a) reports his $100,000; his wife reports $20,000 interest (b) reports his $100,000; he and his wife split the $20,000 interest (c ) reports income of $120,000; his wife reports nothing (d) reports $100,000; his wife reports nothing (e) does none of the above 5. Ashley invested in several Canadian and U.S. companies during 20X4, from which she received the following dividends (in Canadian dollars):
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MC-Class-Property - MULTIPLE CHOICE INCOME FROM PROPERTY 1....

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