During 2019, XYZ Inc bought a tractor for $50,000, which belongs in class 10 with a CCA rate of 30%.Assuming that the tractor is the only asset in that class, what is the maximum CCA that XYZ Inc.can claim for 2019 with respect to the tractor?
A)$7,500
B)$0
C)$22,500
D)$15,000

Question

Quizplus · Accepted Answer

The maximum CCA that XYZ Inc can claim for 2019 with respect to the tractor is calculated as follows:
$50,000 * 30% = $15,000.
However, the half-year rule applies to assets in class 10, which means only half of the CCA can be claimed in the first year. Therefore, the maximum CCA that XYZ Inc can claim for 2019 is $15,000/2 = $7,500. Therefore, the correct answer is (C).

During 2019, XYZ Inc Bought a Tractor for $50,000, Which