Question a. Jagan has income from employment of $25,000 during the year. As well, he has...

Question a.

Jagan has income from employment of $25,000 during the year. As well, he has a capital gain on Listed Personal Property of $8,000 on the sale of a stamp collection, and a capital gain from the sale of some shares of $6,000. Last year, he had a capital loss on Listed Personal Property of $10,000 that he was unable to use and carried forward to the current year. What is his net income for tax purposes for the year, assuming that this accounts for all of his income for the year?

	$31,000
	$27,000
	$28,000
	None of the options are correct.

Question b.

Carrie Weems is a full-time teacher in Waterloo, Ontario, who spends all of her weekends and holidays operating a farm she purchased this year. She is confident that within two years her farm will be making a profit. In the current year, the farm had a loss of $18,000 and her employment income from teaching was $85,000.

In the current year, she can deduct a maximum of $9,000 of the farm loss against all her other income.

	True
	False

Solutions

Expert Solution

1. As per above question the income of the jagan is

Income from employment = $25000

Capital gain from listed personel property = $8000

Capital gain from sale of some shares = $6000

As said in the question the loss of $10000 is not available for the current year and cannot carry forward to this year.

So the income for this year = $25000 + $8000 + $6000

= $39000

So the income for this year = $39000.

Answer is option D None of the options are correct.

False , the Carrie weeks can deduct total $18000 as Deduction from the income .

The deduction is allowed only if the loss can be proved with proper documentation .

Then the deduction wiil be allowed to the Carrie weems is $18000.

So the statement given in the question is false .

Conclusion

1. The answer for the 1st question is option D nine of the above option is correct.

2. The given statement is false.

These are the explanation can be given to the given questions.

I hope, all the above given points are helpful to you.

Thank you.

ekkarill92 answered 2 days ago

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