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:

Trustful Behavior

Actions that demonstrate reliability and sincerity, fostering an environment of trust among individuals.

Synergy

The cooperative interaction among groups that leads to a combined effect greater than the sum of their separate effects.

Heterogeneous Group

A group comprised of members with diverse characteristics, backgrounds, experiences, and skills.

Values Differences

The variety and divergence in beliefs, principles, and standards of behavior among individuals or cultures.