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please please help I will rate definately rate. please please all the question.

7. An investor purchased a $75,000 face value bond at 96.50 plus $1,068 in accrued interest a) What are the tax implications in the year of purchase? b) What are the tax implications at maturity? Given the following information for the previous calendar year, calculate earned income and the maximum RRSP contribution limit for the current yeat. Employment income Book Royalties Consulting income Cdn Dividend income Capital gains PA $48,000 5,500 7,600 2,400 15,000 6,400

Solution

ANSWER 7 (A):-interest when actually received shall be taxable in the hands of holder of the debentures i.e $1068.

ANSWER 7 (B):-

since debentures are purchased at a price of 96.5 which is less than the face value of debentures i.e 100 , therefore difference between the purchase price and face value of debentures i.e 3.5 represents the gain to the holder of the debentures.

therefore tax would be charged at $75000*3.5%=2625

ANSWER 8 :-

calculation of earned income:-

employment income=48000

consulting income=7600

pa =6400

book royalties=5500

total earned income =$67500

* capital gains and dividends income are not considered as earned incomes .