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On April 1,2024, Vini Velasquez receives a five-year, 2% interest-bearing loan of $106,000 from his...

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Accounting

On April 1,2024, Vini Velasquez receives a five-year, 2% interest-bearing loan of $106,000 from his employer
that he uses to purchase investments. Five annual payments of $21,200 plus interest are required to be made
beginning December 31,2024. Assume that Vini could not have borrowed at that interest rate and that the
prescribed interest rates for 2024 are as follows.
View the prescribed interest rates.
What is the amount of the taxable employment benefit that will be required to be included in his 2024
employment income as a result of this loan? Base any calculations on a quarterly basis rather than the number
of days. Assume that any interest payable on the loan is paid by each required annual repayment date.
A. $1,060
B. $2,915
C. $4,505
D. $1,590
Prescribed Interest Rates
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