Reference no: EM133151291

Question - On January1, 2020, Ms. Alice Wong acquires the following investments:

A €500,000 term deposit that pays interest at 7 percent per annum. Interest of €35,000 is paid for 2020. The taxation authorities in the foreign jurisdiction withhold 20 percent of the €35,000, with the remaining 80 percent remitted to Alice. Assume the average exchange rate for 2020 is €1 = $1.50.

1,200 units of the Golden Mountain Real Estate Income Trust. The cost is $92.00per unit for a total cost of $110,400.

8,500 units of the Blackman European Fund, a mutual fund trust. The cost is $23.00 per unit for a total cost of $195,500.

During 2020, the Golden Mountain Real Estate Income Trust makes an annual distribution of $8.75 per unit, of which $3.25 is designated as a return of capital. The remaining $5.50 is property income. Alice has elected to use the trust's DRIP and, as a consequence, the entire distribution is reinvested in new trust units at a cost of $100.00 per unit.

Also during 2020, the Blackman European Fund makes a distribution of $2.10 per unit. This distribution is made up of eligible dividends of $0.70, capital gains of $0.80, and interest income of $0.60. The entire distribution is reinvested in Blackman European Fund units at a cost of $20.00 per unit.

Alice has other investment income that places her in the 29 percent federal tax bracket. Taxes on this income are sufficient to use all of her available tax credits before considering the effects of the investments described above. She lives in a province where the maximum rate is 13 percent and the tax credit on eligible dividends is 21 percent of the gross up.

Required - Calculate the amount of Taxable Income and Tax Payable that will result from the interest on the term deposit and the distributions by the two trusts. In addition, indicate the per unit adjusted cost base for each of the two trust units on December 31, 2020.