Assignment Instructions/ Description
Mini Case 1 (14 marks) Joe, aged 24, and Kate, aged 24, met in college. While studying, Joe worked part-time selling car parts to autobody shops in the GTA. He earned $12,000 a year, for two years. After graduating from his program, Joe landed a job selling cars for Chrysler. Joes started his new job on January 1, 2023, and his annual salary is $80,000 a year. Kate on the other hand, only worked part-time during the summer months of her program. In 2020, she earned $20,000 working for the CNE. In 2021 and 2022, she earned $8,000 a year working at Casino Niagara part-time. Recently, Kate landed a full-time position at the casino. Her annual salary is $65,000 a year. Kate's employer has a defined contribution pension plan it offers its employees. The company matches employee contributions, dollar-for-dollar, to a maximum of 6% of salary. Joe's employer does not offer pension benefits. Assume that Joe's average tax rate is 25% and Kate's average tax rate is 22%. Answer the following questions as of February 1, 2023. 1. If Joe continues to work for his employer, and his salary remains the same, what will be his total RRSP contribution room?