Lien Jones works for the Bank of Montreal. The bank provides loans to its employees at an annual interest rate of 3%. On April 1 of the current year the bank provides Lien with an employee loan in the amount of $24,000 at the annual interest rate of 3%. The loan requires annual principal repayments of $3,000 on April 1 of each year. Lien makes the first annual repayment in the following year, Assume that Canada Revenue Agency's prescribed interest rates for the current year are as follows:
Q1 (Jan. 1 to Mar. 31) = 5%
Q2 (Apr. 1 to June 30) = 4%
Q3 (July 1 to Sept. 30) = 5%
Q4 (Oct. 1 to Dec. 31) = 4%
Calculate the taxable benefit to be included in employment income for Lien Jones in the current year. Round your answer to the nearest dollar.
A. $241
B. $1,440
C. $1,080
D. $784