Required: Calculate total interest income and total interest expense for 2020.

Your client (an individual) has provided you with the following information.

Interest earned on an investment: $1,000

Interest in short-term investments:

$30,000 time deposit received on October 31, 2020 (interest at maturity in six months)

Accrued interest from November 1 to December 31, 2020: $100

$200,000 GIC purchased September 1, 2019 (interest payable at maturity August 31, 2022)

Accrued interest from September 1, 2019 to August 31, 2020: $18,000

Interest accrued from January 1, 2020 to December 31, 2020: $18.444

Canadian Government Treasury Bills purchased on January 3, 2020 for $18,221

Amount received at 31 December 2020: $20,000

Interest expenses paid in 2020:

The interest on the bank credit line used to invest in the shares described above is $44,221.

Loan interest to buy a car: $1,500

Answer rating: 100% (QA)

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