Problem $1$

Part $1-$ Corporation

On April $1,2023,$ a corporation with a December $31$ taxation year

purchased a three$-$year investment certificate for $$20,000.$ The

certificate pays interest only at the end of the three$-$year term but the

interest is compounded annually at the rate of $7\%.$ Currently, the

corporation's marginal tax rate is $28\%.$ However, in $2024,$ the marginal

tax rate will decrease to $20\%.$

Part $2$ Individual

An individual makes the identical investment on April $1,2023.$ The

individual's marginal tax rate in $2023$ is also $28\%$ and is expected to

decrease to $20\%$ in $2024.$

Required:

Complete the table below to show the interest income and the tax

liability each year for the corporation and the individual. Treat each

calendar year as having $365$ days and ignore the implications of

February $29$ in a leap year.