1) A. Six years ago, the Zircon company purchased a long-term asset for $3,875,500. The asset has a 20% CCA rate. Recently, at the end of year six, Zircon sold the asset for 850,000. Given this information, determine the value of the terminal loss or recapture at the end of year six.

B. Zircon Company's effective tax rate is 26%. Calculate the value of the CCA tax shield for the third year (year 3).