Question

On January 1, 2019, the Company has UCC balances for its tangible assets as follows:

Class 8                           575,000

Class 10                        45,000

Class 13                        68,000

There are no dispositions of Class 8 assets during the year. However, there are acquisitions in the total amount of $126,000.

As the Company has decided to lease all of its vehicles in the future, all of the assets in Class 10 are sold during the year. The capital cost of these assets was $93,000 and the proceeds of disposition amounted to $37,000. The net book value of these assets was $52,000 and the resulting accounting loss of $15,000 was included in Other Expenses.

The Class 13 balance relates to a single lease that commenced on January 1, 2017. The lease has an initial term of seven years, with two successive options to renew for three years each. Expenditures on this leasehold were $50,000 in 2017 and $27,000 in 2018. There were no further expenditures in 2019. The write-off of these expenditures for accounting purposes is included in Amortization Expense.

Answer 1

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