Calculating Taxable Income, Income Tax Payable and Effective Tax Rate. (The following information is for solving Questions
Question:
Calculating Taxable Income, Income Tax Payable and Effective Tax Rate. (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 was Taylor’s total income?
$114,000
- $112,000
- $109,500
- $118,200
- None of the Above
Ignoring the RRSP and Charity contributions, what is the amount of taxes Taylor would pay on their salary?
Question 2 options:
$29,800 - $32,200
- $34,225
- $22,500
- None of the Above
Financial and Managerial Accounting
ISBN: 978-0538480895
11th Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren