Question
In 2018 Green Bay Lawns (GBL) purchased 2 class 8 assets which have a CCA rate of 20% for the total amount of $25,000 Item
In 2018 Green Bay Lawns (GBL) purchased 2 class 8 assets which have a CCA rate of 20% for the total amount of $25,000 Item 1 was purchased for $12,000 and Item 2 was purchased for $13,000. At the end of 2019 the UCC of these two class 8 assets was $18,000. In early 2020 Item 1 was sold for $5,000 and item 2 was sold for $8,000. No other class 8 assets remained.
Based on the above information, calculate the effect of this sale.
Assume now that GBL purchased another class 8 asset, a gas trimmer on clearance for $300 at the local hardware store on December 26th of 2020. Calculate the effect of this purchase on Part A above and provide any advice that you feel GBL would benefit from.
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