Part A Calculating Taxable Income, Income Tax Payable and Effective Tax Rate (15 Marks) (The following information is for solving Questions 1 to 13 below)

Tax Brackets for Salary and Interest Income		Dividend Tax Treatment
0 to $15,000 $15,001 to $30,000 $30,001 to $70,000 $70,001 to $110,000 $110,001 to 200,000 $200,000 plus	0% 20% 30% 35% 40% 55%	Dividend Gross Up Rate Federal Dividend Tax Credit Provincial Dividend Tax Credit	20% 14% 8%
Charity Tax Credit		Capital Gains Exclusion Rate	50%
First $200 donation Above $200 donation	12% 20%

It is the month of February, and Taylor is working on their income taxes. Taylor recorded the following information from the past year.

• Salary Income $112,000
• Interest Income from Bond Mutual Fund $2,000
• Capital Gains $3,000
• Dividend Income $1,200
• RRSP Contribution $4,000
• Charity Contributions to Algonquin College Alumni Fund $500

• What is the amount of taxes they would pay on their bond interest income? Assume a 40 percent tax rate.

  Question 3 options:

  	$834
  	$726
  	$648
  	$800
  	None of the Above

  Question 4 (1 point)

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  What is the taxable amount of their capital gains income?

  Question 4 options:

  	$750
  	$1,050
  	$1,500
  	$825
  	None of the Above