An asset was purchased for $$40,000$ and belongs to an asset class with a $20\%$ CCA rate is

depreciated over time for tax purposes.

a$.$ What is the undepreciated capital cost $($UCC$)$ at the end of the second year after the purchase?

b$.$ Suppose the asset is sold for $$26,000$ after three years and the asset pool is terminated. Will the

firm have any terminal loss or recaptured CCA? How much is it$?$