Acme Auto Parts Ltd. has gained approval for an eligible scientific research and experimental development on Cape Breton Island and is intending to invest $1.7 million.
a. Assuming the tax rules governing ITCs and CCA remain the same as represented in this chapter, compute the ITC available to Acme.
b. What will be the original capital cost base for CCA purposes?
c. Compute the present value of the ITC and CCA combined (Acme uses 10 percent as its discount rate). Acme's tax rate is 22 percent.