Gerald Requests an Extension for Filing His Last Year's Individual

question 12

Multiple Choice

Gerald requests an extension for filing his last year's individual income tax return. His tax liability is $10,000, of which $8,000 was withheld, leaving a balance due of $2,000 when he files on August 1 of the current year. His penalty for failure to pay the tax on time is

• A)$0.
• B)$40.
• C)$300.
• D)$400.

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Definitions:

Treasury Bills

Short-term government securities with maturity periods typically of one year or less, considered a low-risk investment.

Least Risky

Describes an investment or action that is considered to have the lowest probability of causing financial loss or harm.

Canadian Common Stocks

Equity in publicly listed Canadian corporations, indicative of part ownership in these enterprises.

Risk Premium

The extra yield an investor anticipates earning for accepting greater risk relative to a risk-free investment.