Question
Saul has two residential rental properties that are mortgaged. Both properties are in Class 1 with a Capital Cost Allowance rate of 4 percent. At
Saul has two residential rental properties that are mortgaged. Both properties are in Class 1 with a Capital Cost Allowance rate of 4 percent. At the beginning of the year, Property A has a Undepreciated Capital Cost of
$500,000
and Property B has a Undepreciated Capital Cost of
$1,100,000.
Before consideration of Capital Cost Allowance, Property A earned net rental income of
$16,000,
and Property B had a net rental loss of
$27,000.
What is the maximum amount of Capital Cost Allowance Saul will be able to claim this year?
A.
$16,000
B.
Nil.
C.
$16,000
D.44000
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