Question 3 - Multiple Choice (6 marks - no part marks) 1) You purchased a Class 1 commercial building as an investment property two years ago. During the current year, you received $8,000 in rent receipts and paid the following expenses interest of $6,000, property taxes of $2,000, heat, light and power of $500, and maintenance of $300. The UCC of the commercial building was $60,000 on January 1. You are able to claim a rental loss in the current year? A) True B) False 2) On July 1, 2020 you borrowed $8,000 from the bank and purchased 400 shares in Gone Ltd for $20 per share. You had read online that Gone Ltd would be paying dividends of $3.00 a share during the last half of 2020. The dividend payment didn't happen as expected and you received a total of $100 in eligible dividends during 2020. On December 31 you paid the bank loan interest of $240. On her 2020 tax return, Esther will report A) Net Property Income of $100 B) Net Property Income of $138. C) Net Property Income of $0. D) Net Property Loss of $102 3) Ryan and Nat each have income of over 5200 000. During the year, they paid a nanny $20,000 to care for their three children. Eric, age 5, has no income. Ellen, age 10 is disabled and eligible for the disability tax credit Edwin is 12 and has income of $25,000 which he earns from a TV acting job. What is the maximum deduction for child care costs for this family? A) $18,000 B) $19.000 C) $24,000 D) 522 000 4) In 2020, you moved from Alberta to Nova Scotia to start a new job. In 2020 you eamed $50,000 in your new job. However, you incurred the following costs of moving: Transport of household effects Travel - self, spouse, and three children Legal fees - house purchase in Nova Scotia Cancellation costs - rental lease in Alberta Temporary accommodation while waiting for new house at $70 per day for 30 days House-hunting trip (prior to move) $5,000 2,000 900 750 2,100 500 Which one of the following amounts represents the maximum amount that you may deduct for moving expenses on your 2020 personal income tax return? A) $ 8,800. B) $ 9,700 C) $10,200 D) $11,250. I 5) During 2019 you have net employment income of $40,000, a net property loss of $16,000, interest income of $6,000, and income from royalties of $7,000. The royalties were on a book you wrote. You do not have Unused RRSP Deduction Room from previous years. Your employer contributed $3,000 to your RPP. Your maximum deductible Registered Retirement Savings Plan contribution for 2020 is A) $3,660 B) $1,320 C) $5,580. D) $2,580. I 6) During 2019, you have employment income of $40,000, a net rental loss of $16,000, interest income of $6.000, and income from royalties of $7,000. The royalties were on a book you wrote. You do not have Unused RRSP Deduction Room from previous years. You are not a member of a Registered Pension Plan during 2019. You contributed $2,000 to your spouse's Registered Retirement Savings Plan in 2020. The maximum deductible 2020 Registered Retirement Savings Plan contribution to your RRSP is: A) $3,580 B) $5,580. C) $4,660 D) $6,660
