What is the undepreciated capital cost of $800,000 asset after five CCA calculations of 30% declining balance, with the half-year rule?

Question

Quizplus · Accepted Answer

Using the formula for calculating the CCA:
Year 1: $800,000 x 30% x 6/12 = $120,000
UCC at the end of Year 1: $800,000 - $120,000 = $680,000
Year 2: $680,000 x 30% = $204,000
UCC at the end of Year 2: $680,000 - $204,000 = $476,000
Year 3: $476,000 x 30% = $142,800
UCC at the end of Year 3: $476,000 - $142,800 = $333,200
Year 4: $333,200 x 30% = $99,960
UCC at the end of Year 4: $333,200 - $99,960 = $233,240
Year 5: $233,240 x 30% = $69,972
UCC at the end of Year 5: $233,240 - $69,972 = $163,268
Therefore, the undepreciated capital cost after five CCA calculations is $163,268. Answer choice C is correct.

What Is the Undepreciated Capital Cost of $800,000 Asset After