Which of the following statements regarding CCA is true?
A) Since CCA deduction is not a cash expense, it plays no role in capital budgeting.
B) The CCA method uses a specific mandated CCA rate for each asset class.
C) The CCA deduction is equal to the year-end UCC for the pool divided by the mandated CCA rate.
D) The CCA method allows that the net capital cost of an asset is added to the pool in the year the asset is put in use.

Question

Quizplus · Accepted Answer

The CCA method uses a specific mandated CCA rate for each asset class, which determines the amount of depreciation that can be claimed for tax purposes.

Which of the Following Statements Regarding CCA Is True