Question
Prior to 2019, Ms. Sada Sale had no earned income for RRSP purposes. In 2019 and 2020, she had sufficient earned income to allow for
Prior to
2019,
Ms.
Sada
Sale
had no earned income for RRSP purposes. In
2019
and
2020,
she had sufficient earned income to allow for maximum allowable RRSP deductions in
2020
and
2021.
However, she did not make any contributions in either of those years.
Sada
participates in her employer's money purchase RPP. Her employer contributes twice the amount contributed by each employee to the plan. Her PA for
2021
is
$14,850.
Sada
has been employed by a Canadian public corporation since
2019.
The following information pertains to her income for the past two years.
|
| 2022 | 2021 |
| Salary Before Taxable Benefits | $151,000 | $151,000 |
| Automobile Benefit | 7,050 | 6,450 |
| Employee Stock Option Benefit | 3,920 | 2,990 |
| Benefit On Interest Free Loan | 1,970 | 1,510 |
| RPP Contributions | (4,450) | (5,010) |
| Other Employment Expenses | (3,160) | (3,700) |
| Interest Income | 2,280 | 2,180 |
| Taxable Capital Gains | 14,300 | 6,320 |
| Business Income (Note 1) | 21,500 | 14,900 |
| Royalty Income (Note 2) | 6,470 | 6,640 |
| Rental Loss | (5,300) | (9,800) |
| Spousal Support Received | 24,200 | 24,200 |
| Eligible Dividends | 1,480 | 1,580 |
| Totals | $221,260 | $199,260 |
Note 1 The business income is from a mail-order business that
Sada
runs out of her home.
Note 2 The royalty income is from a manual that she wrote on how to write instruction manuals.
pop-up content ends
PrintDone
| A. | Calculate Sada's earned income for the purpose of determining her maximum 2022 RRSP contribution. |
| B. | Calculate Sada's maximum deductible RRSP contribution for 2022. |
Ignore all GST/HST & PST considerations.
Requirement A. Calculate
Sada's
Earned Income for the purpose of determining her maximum
2022
RRSP contribution. (For accounts that are not included in the earned income calculation, leave the input field empty; do not enter a zero.)
| Salary Before Taxable Benefits |
|
|
| Automobile Benefit |
|
|
| Employee Stock Option Benefit |
|
|
| Benefit On Interest Free Loan |
|
|
| RPP Contributions |
|
|
| Other Employment Expenses |
|
|
| Total Employment Income |
| |
| Interest Income |
|
|
| Taxable Capital Gains |
|
|
| Business Income |
|
|
| Royalty Income |
|
|
| Rental Loss |
|
|
| Spousal Support Received |
|
|
| Eligible Dividends |
|
|
| Earned Income |
|
|
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Financial Accounting An Integrated Statements Approach
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren
2nd Edition
324312113, 978-0324312119
