1Clarice holds an exchange-traded fund in her tax-free savings account (TFSA) and noticed that the ETF distributed a large sum of return of capital (ROC) in 2018. For tax purposes, she is required to:
A. Subtract the ROC from her cost base
B. Add the ROC to her cost base
C. Report the ROC as a capital gain
D. Do nothing
2As of Jan. 1, 2019, the annual contribution limit for tax-free savings accounts will:
A. Rise to $6,000 from $5,500
B. Rise to $5,750 from $5,500
C. Rise to $5,750 from $5,250
D. Fall to $5,500 from $10,000
Answer: A. Rise to $6,000 from $5,500
3Under enhancements to the Canada Pension Plan, in 2019 employers and employees will each pay ____ per cent of pensionable earnings (above $3,500) toward the CPP, up from 4.95 per cent currently. By 2023, the contribution rate will rise to ____ per cent.
A. 5.45; 6.95
B. 5.10; 5.95
C. 6.95; 8.95
D. 5.90; 6.95
4As of Dec. 20, the yield on the five-year Government of Canada bond was about:
A. 2.45 per cent
B. 2.33 per cent
C. 2.17 per cent
D. 1.95 per cent
5Steve bought 100 shares of Blockchain Marijuana Renewable Energy Corp., which subsequently plunged 80 per cent when a short-seller’s report alleged the company is a scam. The last day Steve can sell the shares and claim a capital loss for 2018 is:
A. Dec. 26
B. Dec. 27
C. Dec. 28
D. Dec. 31
6Through Dec. 20, the best- and worst-performing stocks on the S&P/TSX Composite Index for 2018 were:
A. Canada Goose; Crescent Point Energy
B. Kirkland Lake Gold; Baytex Energy
C. Nevsun Resources; Maxar Technologies
D. Great Canadian Gaming; Aphria
Answer: C. Nevsun Resources; Maxar Technologies
7Santa Claus is thinking about retiring and living off the dividends from his toy and entertainment company stocks. When he sits down to calculate his income, however, he is shocked to discover that one of his stocks paid no dividends in 2018. Which stock is it?
C. Walt Disney
D. Activision Blizzard
8Ms. Claus doesn’t trust Santa’s financial judgment and has built her own dividend-stock portfolio that includes Royal Bank (RY), Enbridge (ENB), BCE (BCE) and Fortis (FTS). Rank the stocks in ascending order of yield:
A. RY, FTS, ENB, BCE
B. FTS, BCE, RY, ENB
C. RY, BCE, ENB, FTS
D. FTS, RY, BCE, ENB
Answer: D. FTS, RY, BCE, ENB
9Which of the following companies did not raise its dividend in 2018?
A. Rogers Communications
Answer: A. Rogers Communications
10Justin wanted some U.S. exposure for his non-registered account. In January, 2018, with the Canadian dollar trading at 80 US cents, he bought 100 shares of Microsoft for US$90 each. He later sold the shares for US$112 each when the Canadian dollar was trading at 75 US cents. His capital gain, in Canadian dollars, was:
11Wilma buys 400 shares of Slate Rock and Gravel Inc. for $20 each. She later sells 100 shares at $25 each. She then buys 200 shares at $27 each. Ignoring commissions, what is the adjusted cost base per share for her 500 shares?
12When an ETF or mutual fund declares a year-end reinvested or “phantom” non-cash distribution, the amount usually consists of ________ and must be _______ the investor’s adjusted cost base.
A. return of capital; subtracted from
B. dividends; subtracted from
C. return of capital; added to
D. capital gains; added to
Answer: D. capital gains; added to
13There is no withholding tax on dividends from U.S. companies if the shares are held in a:
A. RRSP, RRIF or LIRA
B. TFSA, RRSP or RESP
C. RESP, TFSA or RRSP
D. RESP, TFSA or LIRA
Answer: A. RRSP, RRIF or LIRA
14As of Dec. 20, the S&P/TSX Composite Index was ________ for 2018 and the S&P 500 was ________.
A. down 3.7 per cent; up 3.3 per cent
B. down 4.8 per cent; up 1.1 per cent
C. down 8.9 per cent; down 3.7 per cent
D. down 12.8 per cent; down 7.7 per cent
Answer: D. down 12.8 per cent; down 7.7 per cent
15After a rough year on the stock market, Rudolph’s realized capital losses were $28,500 and his realized capital gains were $1,500. For tax purposes, he can carry back _____ of losses for up to three years or forward ______.
A. $28,500; three years
B. $27,000; indefinitely
C. $27,000; five years
D. $28,500, indefinitely
Answer: B. $27,000; indefinitely
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