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You have purchased $320,000 of computer equipment that is in a CCA Class 10 (Canada Revenue...

You have purchased $320,000 of computer equipment that is in a CCA Class 10 (Canada Revenue Agency). Using the half-in-first-year rule, how much depreciation would occur in year 3?

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Expert Solution

Applicable depreciation rate will be 30% for class 10.

Year Opening Value
(UCC)		 Depreciation Ending Value (UCC)
1               3,20,000              48,000           2,72,000
2               2,72,000              81,600           1,90,400
3               1,90,400              57,120           1,33,280

Due to applicability of half-in-first-year rule, depreciation in year of purchase will be half of normal depreciation.

ekkarill92 answered 1 year ago
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