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How much interest income must the individual

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Question - On July 1, 2018, an individual invests $100,000 in a term deposit earning interest at 2% over a three-year term. The term deposit pays the interest by depositing it into the individual's bank account on December 31, 2019, and upon maturity on June 30, 2021.

A corporation with a December 31 year end invests $100,000 beginning on June 30, 2018, in the same term deposit. How much interest income must the individual and the corporation report for the 2019 taxation year? Ignore the effect of compounding.

a) Individual: $3,000, corporation: $2,000

b) Individual: $3,000, corporation: $3,000

c) Individual: $2,000, corporation: $2,000

d) Individual: $2,000, corporation: $3,000

Reference no: EM132694224

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