In the previous year, an employee received a $30,000 loan to acquire a house at a 2% interest rate. Canada Revenue Agency's (CRA's) prescribed interest rate at the time the loan was made was 3 %. In the current year CRA's prescribed rate was 4%. The employee's tax rate is 40 % . What would be the taxable benefit and the tax paid by the employee in the current year on the loan? Multiple Choice $900 and $600 $600 and $240 $300 and $120 $900 and $360

In the previous year, an employee received a $30,000 loan to acquire a house at a 2% interest rate. Canada Revenue Agency's (CRA's) prescribed interest rate at the time the loan was made was 3 %. In the current year CRA's prescribed rate was 4%. The employee's tax rate is 40 % . What would be the taxable benefit and the tax paid by the employee in the current year on the loan? Multiple Choice $900 and $600 $600 and $240 $300 and $120 $900 and $360

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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