$45,875$ ASSIGNMENT PROBLEMS

Type $1$ Problems

Memorandum

Acme Inc.

To: from:

Dale:

Staff Accountant

Controller

Month xx$,2017$

CCA Calculations and Adjustments

Subject:

We are in the process of completing the corporate tax return and we have come to the fixed asset section, where we have identified three things that I would like you to do$.$

$$Calculate the maximum CCA that can be claimed, as well as any other income inclusions or deductions.

$$Calculate the ending UCC balance in each class.

$$Identify adjustments you will need to make to reconcile accounting income and income for tax purposes.

The following is the information in our files:

Acme Inc. has been in business for a number of years. The following are the balances in its CCA classes at the end of its last fiscal year:

Class

$10$

$10\mathrm{.}1$

Single building $($NRB$)$

Multiple assets

Multiple assets

Passenger vehicle

Note

$1$

$2$

$34$

Rate $6\%$

$20\%$

$30\%$

$30\%$

Balance

$ $225,000$

$30,000$

$20,000$

$13,000$

During the year Acme had the following transactions:

$$It sold its building and moved into rented space. It received proceeds of $$250,000$ for the building which had an original cost of $$275,000$ and a net book value of $$180,000.$

$$It sold a class $8$ asset for $$3,000$ which had an original cost of $$6,500$ and a net book value of $$3,600.$

$$It bought a class $10$ asset for $$6,000.$ It also sold a class $10$ asset for $$8,000$ which had an original cost of $$7,000$ and a net book value of $$5,500.$

$$It sold the class $10\mathrm{.}1$ asset for $$15,000$ which had an original cost of $$45,000$ and a net book value of $$35,000.$