With respect to the determination of Tax Payable for a corporation, which of the following statements is correct?

Question

Quizplus · Accepted Answer

The general rate reduction is a percentage that reduces the federal corporate income tax rate. It is applied to the full rate taxable income before provincial or territorial taxes are calculated. Therefore, statement B is correct.

Statement A is incorrect as provincial tax rates vary by province and are not necessarily based on a percentage of federal Tax payable.

Statement C is incorrect as the federal tax rate varies depending on the type of income earned by the corporation.

Statement D is incorrect as the federal tax abatement is a fixed amount of $500,000, not a percentage of taxable income.

With Respect to the Determination of Tax Payable for a Corporation