Consider a firm that has two assets in its Class 10 Asset Pool. The current UCC of this asset pool is $11,000. Asset 1 was purchased 4 years ago for $10,000, and Asset 2 was acquired 3 years ago also for $10,000. If the firm sells Asset 1 and 2 for $4,000 and $6,000, respectively, and the Class 10 Asset Pool is closed, what would be the firm's tax consequences? Assume a tax rate of 40%.

a) The firm has to pay a capital gains tax. b) The sale of the two assets will result in a terminal loss and a final CCA tax shield of $400. c) Due to the sale of the two assets the firm will pay additional taxes of $400. d) There won't be any tax consequences when the pool is closed. e) The firm has under-depreciated the two assets and will need to pay taxes of $200.

Please do not use excel