Ms. Elana is required by her contract of employment to use her own car in the performance of her employment duties and to pay for all expenses. Ms. Elana leased a Mercedes from Sky’s-The-Limit Leasing. The following facts relate to the leased Mercedes:

REQUIRED
Determine the amount deductible in respect of the car for the year 2016 on the assumption that a total of $13,893 of leasing costs had been deducted prior to 2016. Assume an HST rate of 14%. Ignore the effects of the leap year.

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Lease period Lease cost per month, including HST Manufacturer's list price, excluding HST Total kilometres Ttal employment kilometres Gas and oil Maintenance Insurance Licences Oct. 1, 2014 to Sept. 30, 2017 $1,600 $60,000 30,000 20,000 $ 1,500 700 2,000 100