Ms Gold has been investing in real estate for almost half a century On January 1, 2018, she owned four rental properties and the relevant facts on these properties are as follows 112 Bay Street This is a Class 3 building that has a capital cost of $850,000 Its UCC at the beginning of the year was $627,000 During the year, it generated rent of $81,000 and incurred property taxes of $10,500, interest charges of $13,000, and other expenses (excluding CCA) of $17,500 2022 Richmond Road This is a Class 3 building that had a capital cost of $45,000 It was sold on June 1 For CCA purposes, it was included in the same Class 3 pool as 2024 Richmond Road Of the sale proceeds, $58,000 was allocated to the building From January 1 to May 31, the building generated rent of $10,000 and incurred property taxes of $3,600, interest charges of $1,100, and other expenses (excluding CCA) of $1,500 This property contained furniture that Ms Gold had acquired at a cost of $6,000 On January 1, 2018, this furniture had a UCC balance of $3,500 It was sold at the same time as the rental property The proceeds of the furniture sale were $2,300 2024 Richmond Road This is a Class 3 building that has a capital cost of $45,000 At the beginning of the year, the UCC of the Class 3 pool, which included both 2022 Richmond Road and 2024 Richmond Road, was $61,000 During the year, it generated rent of $24,000 and incurred property taxes of $7,750, interest charges of $1,800, and other expenses (excluding CCA) of $3,600 16 Booth Street This Class 1 building has a capital cost of $418,000 Its UCC at the beginning of the year was $383,000 During the year, the unit generated rent of $18,000 and incurred property taxes of $6,500, interest charges of $10,800, and other expenses (excluding CCA) of $4,400 Required Calculate Ms Golds net rental income for 2018 You should provide a separate calculation for each property Specify how much CCA should be taken for each building (18 marks)

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Sep 14, 2024

Ms. Gold has been investing in real estate for almost half a century. On January 1, 2018, she owned four rental properties and the relevant

Ms. Gold has been investing in real estate for almost half a century. On January 1, 2018, she owned four rental properties and the relevant facts on these properties are as follows:

112 Bay Street This is a Class 3 building that has a capital cost of $850,000. Its UCC at the beginning of the year was $627,000. During the year, it generated rent of $81,000 and incurred property taxes of $10,500, interest charges of $13,000, and other expenses (excluding CCA) of $17,500.
2022 Richmond Road This is a Class 3 building that had a capital cost of $45,000. It was sold on June 1. For CCA purposes, it was included in the same Class 3 pool as 2024 Richmond Road. Of the sale proceeds, $58,000 was allocated to the building. From January 1 to May 31, the building generated rent of $10,000 and incurred property taxes of $3,600, interest charges of $1,100, and other expenses (excluding CCA) of $1,500. This property contained furniture that Ms. Gold had acquired at a cost of $6,000. On January 1, 2018, this furniture had a UCC balance of $3,500. It was sold at the same time as the rental property. The proceeds of the furniture sale were $2,300.
2024 Richmond Road This is a Class 3 building that has a capital cost of $45,000. At the beginning of the year, the UCC of the Class 3 pool, which included both 2022 Richmond Road and 2024 Richmond Road, was $61,000. During the year, it generated rent of $24,000 and incurred property taxes of $7,750, interest charges of $1,800, and other expenses (excluding CCA) of $3,600.
16 Booth Street This Class 1 building has a capital cost of $418,000. Its UCC at the beginning of the year was $383,000. During the year, the unit generated rent of $18,000 and incurred property taxes of $6,500, interest charges of $10,800, and other expenses (excluding CCA) of $4,400.

Required:

Calculate Ms. Golds net rental income for 2018. You should provide a separate calculation for each property. Specify how much CCA should be taken for each building. (18 marks)