A Piece of Equipment, Acquired in Year 1, Belongs to Class

question 183

Multiple Choice

A piece of equipment, acquired in Year 1, belongs to Class 7 with a maximum CCA rate of 15%. The income tax rate is 40%. The tax savings (before discounting) from the CCA tax shield were $2,830.50 for Year 3. The after-tax cost of capital is 10%.
- What is the approximate undepreciated capital cost (UCC) balance for the equipment at the beginning of Year 3?

• A) $7,076.
• B) $8,325.
• C) $31,450.
• D) $47,175.

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Definitions:

Knowledge and Skills

The theoretical understanding, practical abilities, and expertise required to perform tasks or solve problems efficiently.

Barrier to Task Completion

An obstacle or challenge that hinders the ability to successfully finish a task.

Highly Specific Goals

Objectives that are distinctly defined with clear, precise outcomes that leave little to no ambiguity in interpretation.

Inadequate Preparation

The lack of sufficient readiness or groundwork, often leading to difficulties in effectively handling tasks, responsibilities, or challenges.