26. Indcate which af the foliowing is not listed personal property A. tamp B. Ar

Question

26. Indcate which af the foliowing is not listed personal property A. tamp B. Arare manuscript C. An anique chair D. Apiece of jewelry. 27. The two variables used to alocate income between penmanent establishments when a corporation has peemanent establishments in more than one province are: A Gross salaries and net income for tax purposes of the establishment D. Gross salaries and allocated revenue of the estabishment 28. Which of the following statoments is cormect? A. Public and private corporations are eligible for the general rate reduction B. All private corporations are elgibla for the smal business deduction C. Canadian controlled pubic and private corpcrations are elgibla for the sm business deduction D. It a corporation claims the small business deduction, it cannot claim the general rate reduction 29. The 17.5 parcent smal business deduction is only avalable on: A. The first $500,000 in manutacturing and prooessing income eaned by a Canadian B. The acive business income of a private corpcration with no more than five ful-time C. All of the income eamed in Canada by a Caredan controled private corporaion controlled private corporation employees dewoted to the production of property income None of the abowe D. 30. Halilax Corporation, a CCPC, had taxable income of 5450,000 in ns 20x5 fiscal year. In calculating its taxes owing, the company received a smal business deduction of $46,375, and an M&P; deducion of $13,000 What is the correct amount of Halifax Corpcration's General Rate Reduction? A. Nil B $11,050. C. $50,954 D. $58,500.

Explanation / Answer

Answers

Q 26) C. An antique chair

Reason: Listed personal property includes any paintings sculptures etc, jewellery, rare manuscript , stamp & coin.

Q 27) B. Gross revenue & salaries and wages paid by the establishment.

Reason: Corporation uses either a general allocation formula based on salaries & wages and gross revenue or and industry unique formula to allocate taxable income.

Q 28) A. Public and private corporation are eligible for general rate reduction.

Reason: as other 3 options are incorrect as general rate reduction can be claimed even after small business deduction plus all canadian controlled private corporation are eligible for small business deduction and not all private.

and only private CCPCs are eligible for small business deduction.

Q 29) D. none of the above.

Reason: The small business deduction is a tax deferral available for canadian controlled private corporation(CCPCs) amounting to a maximum tax credit of 17.5% on a CCPC's first $500000 of active business income. Each associated group of CCPC is entitled to $500000 business limit.

Q 30) C. $50954 approximately

Reason: General rate reduction= 13% ( Taxable income - small business deduction - M & P deduction)

= 13% ( 450000 - 46375 - 13000

= $ 50781 nearly

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