John Flynn lives in Nova Scotia. In 2014 he earned $1,500 in interest income and $3,000 in

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John Flynn lives in Nova Scotia. In 2014 he earned $1,500 in interest income and $3,000 in dividend income, and realized a $2,000 capital gain. Calculate his after-tax income and tax rate for each type of income, assuming that his marginal federal tax rate was 26%, his marginal provincial tax rate was 16.67%, the dividend gross-up factor is 141%, the federal dividend tax credit is 1S.02% of grossed-up dividends, and the provincial dividend tax credit is 8.8S% of grossed-up dividends.
Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
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Fundamentals of Corporate Finance

ISBN: 978-1259024962

6th Canadian edition

Authors: Richard Brealey, Stewart Myers, Alan Marcus, Devashis Mitra, Elizabeth Maynes, William Lim

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