Homework answers / question archive / Consider an equipment purchase of $90,000 today (during 2018) that will be put into operation in its 4th year (during 2021)

Consider an equipment purchase of $90,000 today (during 2018) that will be put into operation in its 4th year (during 2021)

Economics

Share With

Consider an equipment purchase of $90,000 today (during 2018) that will be put into operation in its 4th year (during 2021). The equipment is expected to be operational for 20 years. In 2024 the equipment will require an overhaul costing $40,000. Using the CCA method (50% rule applies to both equipment and overhaul) and assuming a CCA equipment rate of 40% and CCAoverhaul rate of 30 %, what is the total projected CCA for 2027: CCA2027? 
a) Between $2,296 and $2,383 
b) Between $2,396 and $2,483 
c) Between $2,496 and $2,583 
d) Between $2,194 and $2,283 
0 e) None of the above