Hunter Brown's Bargains Ltd. began operations on January 1, 2020. All income in the company classifies as 'business income'. The following information was provided: 

a) The business signed a 6-year lease for a building when the business began. There is an option to renew the lease for an additional 2 years. The business spent $70,000 in 2020 on improvements to the leased building at the beginning of the year. 

b) The business purchased land and a building adjacent to his business for $120,000 in 2020. The building was valued at $80,000 and is used as a storage facility. A decision was made to claim 4% CCA on the building. 

c) Several small tools were purchased in 2020. The total cost of these tools was $5,000, and each tool cost under $500. 

d) A delivery van costing $40,000 was purchased in 2020. 

e) Business furniture was purchased in 2020 at a cost of $20,000. 

f) A computer was purchased in 2020 at a cost $1,500.

g) Incorporation costs for the business in 2020 were $5,500. 

h) The business purchased a $42,000 passenger vehicle. The business is an HST registrant.

i) The business was very successful in the first year, so maximum CCA is claimed in 2020. The following transactions occurred in 2021:

j) The delivery truck was sold for $35,000, and a newer and larger model for $50,000 was immediately purchased.

k) New shelving was purchased for the reception area, at a cost of $3,000. 

l) Maximum CCA was claimed for the year.

Required: Calculate the capital cost allowance per class claimed by the company in 2020 and 2021. All the assets qualify as Accelerated Investment Incentive Property. (Round all answers to the nearest dollar.)

Answer rating: 100% (QA)

The business signed a 6year lease for a building when the business began There is an option to renew ... View the full answer