Christopher Dunn is 37 years old.He has been married to Kathy Dunn for 12 years.During 2019, Kathy has Net Income For Tax Purposes of $8,200, all from investments.During 2019, Christopher works 275 hours as a volunteer firefighter in his local community.He did not receive any compensation for this work.

After many years of renting, on February 1, 2019, Christopher and Kathy purchase a new residence for $432,000.They get a $200,000 mortgage at 2.5 percent per annum to finance the purchase.

Christopher and Kathy's only surviving parent is her father, Jason.He is 66 years old and, while he is dependent on Christopher and Kathy because of a physical infirmity requiring the use of a wheelchair, his condition is not severe enough for him to qualify for the disability tax credit.His 2019 Net Income For Tax Purposes is equal to $9,400.This includes OAS payments and a small pension from a former employer.

During 2019, Christopher spent $12,000 modifying their new home to accommodate Jason's wheelchair.The work was enduring in nature and will allow Jason to be much more mobile within the home.

During 2019 Christopher paid the following:

Root Canal Fee For Christopher$1,525

Hair Replacement Fees For Christopher 4,300

Prescription Glasses And Contact Lenses For Kathy1,342

Teeth Whitening Fees For Kathy2,000

Psychologist Consulting Fees For Kathy2,450

Electric Wheelchair For Jason3,300

Physiotherapy Fees For Jason3,420

Employment Information

Christopher works for a large Canadian public company.His salary is $67,460, none of which involves commissions.His employer withholds the following amounts during 2019:

Registered Pension Plan Contributions (Note 1) $4,200

EI Premiums860

CPP Contributions2,749

Contributions To The Canadian Cancer Society (Note 2)3,200

Note 1Christopher's employer makes a matching contribution of $4,200.

Note 2The Canadian Cancer Society is a registered Canadian charity.

Christopher is required to travel fairly extensively by his employer.He uses his own automobile for this travel.His current automobile was acquired on January 1, 2019 at a cost of $42,000.During 2019, the automobile is driven 32,000 kilometers, 25,600 of which were employment related.Operating costs for the year totaled $4,900.

At the time he purchased this automobile, his employer provided him with an interest free loan of $20,000 to assist in the car purchase.None of this loan will be repaid until 2020.Assume that the relevant prescribed rate of interest throughout 2019 was 1 percent.

In addition to his automobile costs, his other 2019 travel costs were as follows:

Hotels$2,700

Food While Travelling For Employer1,800

His employer provides him with the following allowances for his travel:

Hotels And Food$4,800

Use Of Personal Automobile ($100 Per Week)5,200

Investment Information

Early in 2019, Christopher's father died of cancer and left him a very large inheritance which Christopher invested to create a substantial investment portfolio.Christopher paid off his mortgage on September 25, 2019 with funds from his inheritance.On October 1, 2019, he used his house as collateral for a new $200,000 mortgage at the same 2.5 percent per annum rate.He immediately invested the funds in shares of Canadian public companies.

The 2019 results for his investments are as follows:

Canadian Public CompaniesDuring the year he receives $23,000 in eligible dividends from his holdings of Canadian public companies.

Canadian Controlled Private CompanyHe has invested in a local company founded by a close friend that has developed a revolutionary new product.As the product is becoming successful, the Company pays Christopher non-eligible dividends of $15,000 during the year.

Foreign Preferred SharesIn 2019 he purchased US$25,000 in preferred shares of U.S. based public companies.At the time he purchased these shares, the exchange rate was US$1.00 = C$1.40.During 2019, these shares pay dividends of US$1,800.Ten percent of this amount was withheld by U.S. tax authorities.The average exchange rate for 2019 was US$1.00 = C$1.35.

Mutual Fund TrustsDuring the year, Christopher's holdings of mutual fund trusts distribute a total of $34,250.The breakdown of these distributions is as follows:

Capital Gains$20,000

Eligible Dividends9,000

Interest Income5,250

Total$34,250

Required:Ignore GST/HST/PST considerations in your solution, as well as the provisions of the U.S./Canada international tax treaty.

A.Determine Christopher's 2019 Net Income For Tax Purposes

B.Determine Christopher's 2019 Taxable Income

C.Determine Christopher's 2019 Federal Tax Payable.