Cost of the asset$100,000
Life of the asset 5 years
Depreciation rate20%
Capital cost allowance rate 50%
Residual value of the asset nil
Income tax rate 50%
-What is the scrap/salvage value deducted from to calculate depreciation?
A) the depreciated cost
B) the discounted cost
C) the purchase price
D) the estimated useful value

Question

Cost of the asset$100,000 
Life of the asset 5 years 
Depreciation rate20% 
Capital cost allowance rate 50% 
Residual value of the asset nil 
Income tax rate 50%
-What is the scrap/salvage value deducted from to calculate depreciation?
A) the depreciated cost
B) the discounted cost
C) the purchase price
D) the estimated useful value

Quizplus · Accepted Answer

The scrap/salvage value is deducted from the purchase price of the asset to calculate depreciation.

Cost of the Asset$100,000