Confu Corp's income statement for the year ended 2019 shows depreciation expense of $25,000.The total amount of CCA claimed in 2019 _____________
A)must equal
B)cannot equal
C)need not equal
D)must be less than

Question

Quizplus · Accepted Answer

CCA (Capital Cost Allowance) is the amount that can be claimed as a tax deduction for depreciable assets. The fact that Confu Corp reported depreciation expense of $25,000 does not necessarily mean that the total amount of CCA claimed in 2019 must equal, cannot equal or must be less than $25,000. The amount of CCA claimed for tax purposes may differ from the reported depreciation expense due to differences in tax rules and accounting rules. Therefore, the best choice is C: need not equal.

Confu Corp's Income Statement for the Year Ended 2019 Shows