The Following Cases Pertain to Some of the Unique Aspects

question 2

Essay

The following cases pertain to some of the unique aspects regarding the sale of
various types of capital properties. Next to each case, identify (from the list) the
type of capital property that applies. (Select only one category of capital property for each case and use each category only once.)
Gains are treated as business income or business losses.
The weighted average method is used to determine the adjusted cost base in order to determine the capital gain or loss.
Though typically of an inventory nature, the CRA allows gains on these
sales to be reported as capital unless the nature of the taxpayer's business is closely related.
A capital gain deferral may be recognized provided a reinvestment in common shares from the treasury of a replacement entity is made.
A gain resulting from the receipt of compensation for expropriated property may be deferred if the property is replaced before the end of the second
taxation year that begins following the year of expropriation.
The grantor must report a capital gain in the year received.
List of capital properties:
Identical properties Options and warrants
Commodities and futures transactions Goodwill and eligible capital property Voluntary and involuntary dispositions Eligible small-business investments
Gifts of Canadian public securities

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Definitions:

Alertness

The state of being quick to notice and respond to potential dangers or opportunities.

School Start Time

The designated time at which school classes begin for the day, which can significantly impact students' sleep, health, and learning.

Risky Activity

Engagements or behaviors that involve a significant likelihood of suffering harm or loss.

Self-Control

The ability to regulate one's emotions, thoughts, and behaviors in the face of temptations and impulses.