If a Leased Asset Were Scrapped from a Continuing CCA

question 65

Multiple Choice

If a leased asset were scrapped from a continuing CCA pool after four years, and its UCC were $10,000 and its salvage is zero, what would the present value of this asset's tax shelter be if the appropriate after-tax borrowing rate is 9%, the CCA rate is 20%, and the tax rate is 40%?

• A)- $2,759
• B)- $1,955
• C)+ $10,000
• D)+ $2,759

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Definitions:

Subunits

refer to smaller, component parts or divisions within a larger organization, each focused on specific operational areas or functions.

Important Problems

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Referent Power

Influence derived from being admired, respected, or identified with, encouraging others to follow voluntarily.

Subordinates

Individuals who are lower in rank or position and are under the direction of someone else in an organization or hierarchy.