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Starfax Ltd. is a Canadian controlled private corporation that is not associated with any other corporation and is not involved in manufacturing or processing activities. In the current year, Starfax Ltd. has net income for tax purposes of $635,000. This income is comprised of the following amounts: Active business income $590,000 Dividend income from taxable Canadian corporations $ 30,000 • Canadian source interest income $ 15,000 Which of the following is the correct General Rate Reduction for Starfax Ltd. in the current year? O A. $11,700 O B. $1,950 O C. $78,650 O D. $82,550

Starfax Ltd. is a Canadian controlled private corporation that is not associated with any other corporation and is not involved in manufacturing or processing activities. In the current year, Starfax Ltd. has net income for tax purposes of $635,000. This income is comprised of the following amounts: Active business income $590,000 Dividend income from taxable Canadian corporations $ 30,000 • Canadian source interest income $ 15,000 Which of the following is the correct General Rate Reduction for Starfax Ltd. in the current year? O A. $11,700 O B. $1,950 O C. $78,650 O D. $82,550

FINANCIAL ACCOUNTING
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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Starfax Ltd. is a Canadian controlled private corporation that is not associated with any other corporation and is not involved in manufacturing or processing activities. In the current year, Starfax Ltd. has net income for tax purposes of $635,000. This income is comprised of the following amounts: Active business income $590,000 Dividend income from taxable Canadian corporations $ 30,000 • Canadian source interest income $ 15,000 Which of the following is the correct General Rate Reduction for Starfax Ltd. in the current year? O A. $11,700 O B. $1,950 O C. $78,650 O D. $82,550
Transcribed Image Text:Starfax Ltd. is a Canadian controlled private corporation that is not associated with any other corporation and is not involved in manufacturing or processing activities. In the current year, Starfax Ltd. has net income for tax purposes of $635,000. This income is comprised of the following amounts: Active business income $590,000 Dividend income from taxable Canadian corporations $ 30,000 • Canadian source interest income $ 15,000 Which of the following is the correct General Rate Reduction for Starfax Ltd. in the current year? O A. $11,700 O B. $1,950 O C. $78,650 O D. $82,550
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