Multiple Choice

1.Jackie Bryson borrows $300,000 and invests the entire amount in the shares of Rollin Inc. Nine months later, he sells these shares for $160,000. The proceeds of the sale are used to pay off $160,000 of the loan, leaving an ongoing balance of $140,000. Interest on this remaining amount will continue to be deductible. This is an example of:

a. Eligible Dividends

b. Cash Damming

c. Disappearing Source Rule

d. Replacement with Single Property

2.The basic tax credit, spousal tax credit, and Canada employment tax credit are all based on a credit rate of ________ of a specified amount.

a, 10%

b. 7%

c. 15%

d. 19%

3.What is the maximum federal tax rate levied on an individual's taxable income for the current taxation year?

a. 29%

b. 33%

c. 26%

d. 15%

4.Which of the following medical expenses does NOT qualify for the ITA 118.2 Medical Expense Tax Credit?

a. Amounts paid for guide dogs and specifically trained service animals

b. Amounts paid for teeth whitening procedures

c. Amounts paid for dentures

d. Amounts paid for prescription eyeglasses or contact lenses

5.Regarding the taxation of non-residents in Canada, ________.

a. non-residents are never subject to Canadian tax

b. non-residents are only subject to tax in Canada on employment income earned in Canada

c. non-residents are subject to tax on certain sources of income earned in Canada

d. non-residents who are employed in Canada are taxed on the same income as residents of Canada