Calculate the accounting or net book value

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Question - Company C purchased several pieces of equipment for a total of $ 60,000 on January 1, 2019-its first day of business. Depreciation method is straight line over 5 years with no residual value. On June 1, 2021 Company C sold one piece of equipment with an original cost of $ 12,000, purchased on January 1, 2019, for proceeds of $ 1,000. On July 1, 2021 Company C sold another piece equipment with an original cost of $ 9,000, purchased on January 1, 2019, for proceeds of $ 10,000. Company C also purchased new equipment in 2020 for $ 18,000. This is also being depreciated over 5 years on a straight line basis with no residual value. For simplicity assume Company C takes a full year depreciation in the year acquired and none in the year of disposal. Company C claimed CCA of $ 18,000 in 2019, $ 12,000 in both 2020 and 2021.This is for the assets remaining in the asset pool after disposal and includes the CCA on the addition in 2020.For simplicity ignore the half year rule.

Required - Calculate the accounting, or net book value (NBV) and the tax value or undepreciated capital cost (UCC) at the end of 2019, 2020 and 2021.

Reference no: EM133025761

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