Since the CCA deducted each year is a proportion of the undepreciated capital cost (UCC),UCC will gradually become ________.
A) zero
B) a small negative number
C) a small positive number
D) none of the above

Question

Quizplus · Accepted Answer

The UCC will gradually become a small positive number because the CCA is a percentage of the UCC, and as it is deducted each year, the UCC decreases but does not reach zero due to the diminishing balance method.

Since the CCA Deducted Each Year Is a Proportion of the Undepreciated