1. A company pays an employee an allowance for the business use of the employees automobiles. The allowance would be deductible to the employer if

Multiple Choice

• the amount was tax free to the employee. The employee would not be able to claim their actual automobile expenses.

• the amount was 50 cents per kilometre of business use.

• the amount was 70 cents per kilometre of business use. The amount is reasonable based on a review of mileage logs and the employees actual expenses of prior years.

• the amount was reasonable.

2. J Inc. incurred (and paid) the following expenses in the current year: $10,000 for advertising in a foreign trade magazine that is distributed to customers in Canada, $5,000 paid to a registered charity, $6,000 annual dues to a golf club used by executives to entertain customers, and $4,000 to sponsor a local softball team (business name on team jerseys). Determine the amount deductible in computing Js business income for tax purposes for the current year.

3. Employers can deduct unpaid remuneration for tax purposes in a taxation year

Multiple Choice

• if paid within 180 days of the taxation year.

• if paid within 250 days of the taxation year.

• if paid within two years of the taxation year.

• if paid within 365 days of the taxation year.