Very Big Ltd is a large business taxpayer that leases most of its assets, and only owns the following assets.
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Asset A which had been purchased a few years ago had a life expectancy of 8 years and cost $1,500. Its opening adjustable value for the current year was $985.
Asset B which was bought on 1 November CY at the cost $760. It had a life expectancy of 5 years.
Asset C bought in the PY at a cost of $20,000 and had an opening adjustable value of $18,800. It had a life expectancy of 15 years.
Asset D bought on 1 August CY for $220,000, and the asset has an effective life of 8 years.
State ALL the answers that are CORRECT.
Group of answer choices
Very Big Ltd will be able to claim depreciation of at the rate of 25% on $220,000 for 334 days for Asset D.
Very Big Ltd can allocate both Assets A and B to a Low-Value Pool and depreciate them at 37.5%.
If Very Big Ltd has created a Low Value Pool, it must not put Asset A into a Low Value Pool as it can claim depreciation at the rate of 25% for the current year instead of 18.75% if allocated to the pool.
Very Big Ltd will be able obtain a deduction of $2506 for the current year for Asset C.