For its taxation year ending December $31,2023,$ Axel Ltd$.$ has estimated that its net and taxable

income, before any deductions for CCA, will be $$42,000.$

On January $1,2023$ the Company has the following UCC balance's:

$*$This balance reflects leasehold improvements made in January of $2021$ at a total cost of

$$126,000.$ The original term of the lease was $4$ years. However, there are two available renewal

options, each allowing the Company to renew for a period of two years.

In $2023,$ Class $10$ property was purchased for $$76,000$ and Class $10$ property with a capital cost

of $$68,000$ was sold for $$58,000.$ There remain Class $10$ property at December $31,2023.$

Required:

Calculate the maximum $2023$ CCA for each class.

Part$2$

Briefly explain why it is important to take care in allocating depreciable property to the

appropriate CCA class.