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Q1) In January 1998, Kendall Manufacturing Company purchased a new numerical control machine at a cost of $50,000. The machine had an expected life of
Q1) In January 1998, Kendall Manufacturing Company purchased a new numerical control machine at a cost of $50,000. The machine had an expected life of 10 years at the time of purchase and a zero expected salvage value at the end of the 10 years. For tax purposes, the machine has a CCA rate = 40%. In January 2000, however, the machine was thoroughly overhauled and rebuilt at a cost of $20,000. It was estimated that the overhaul would extend the machine's useful life by five years. For tax purposes, the overhaul has a CCA rate = 30%. 50% rule applies to both the machine and the overhaul. Calculate the full CCA for the year 2003 for this machine and overhaul together. Within $5 of which of the following? a) 4552.6 b) 4562.6 c) 4572.6 d) 4582.6 e) None of the above
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