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TIF PROBLEM SEVEN - 8 Rental Income And CCA On Rental Properties In March, 2017, Andrew Thorne acquired a four unit apartment building at a cost of $875,000. Of this
total, it is estimated that the land on which the building is situated is worth $185,000. The units in the apartment are similar in size, and for purposes of allocation to a CCA class, the property is considered to
be a single asset. Two of the units will be rented on a furnished basis. To this end, Andrew has acquired furniture at a cost
of $43,000. During April, 2017, all of the units were rented for the remainder of the year. For this year, the units
generated rents of $83,600 and expenses, other than CCA, of $23,400 were incurred. In July, 2018, the tenants in both of the furnished units terminate their leases and move out. Because he
is unable to find tenants who are interested in furnished units, the two units remain empty for three months. Given this situation, Andrew sells all of the furniture for $31,000.
During 2018, the units generate rents of $54,500. Expenses for the year, other than CCA, total $29,400.
Andrew deducts the maximum CCA allowable in both 2017 and 2018. Required: Calculate the Net Rental Income for each of the two years 2017 and 2018. Also, determine
his UCC balances on January 1, 2019. Include in your solution any tax consequences associated with
the sale of the furniture.

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New Doc 2020-01-06 17.55.57_2.jpg

Total propsry
Four buildin cost =
$ 875, or
Land 's worth on which
is built =
8 185, or0
Building cost 2
2($ 875, 000 -$185080 )- $690000
2 units
on a
fumished basis
turnitur coot...

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