On January 1, 2018, the beginning of its taxation year, Bard Ltd. has the following information on depreciable
assets in its records:
Type Of Asset Capital Cost Capital Cost
Class 8 Furniture $ 24,000 $147,000
Class 1 Buildings (Acquired In 2005)562,000 846,000
Class 10 Automobiles 220,000 315,000
During the 2018 taxation year, the following transactions occur:
Sale Of Furniture Furniture with an original cost of $52,000 was sold for $36,000.
Purchase And Sale Of Buildings A new building was acquired on February 1, 2018 at a cost of $325,000. Of this total, $75,000 was the estimated value of the land on which the building was situated. As the building will be used 100 percent for non-residential purposes and is placed in a separate Class 1, it is eligible for an enhanced CCA rate. As no manufacturing is involved, the enhanced rate is 6 percent.
Also during the year, a building with an original cost of $335,000 was sold for $352,000. Of the $352,000 received, $200,000 is for the land on which the building is situated. The adjusted cost base of the land was equal to the $200,000 proceeds of disposition.
Sale Of Automobiles An extensive analysis of capital and operating costs indicated that the Company would be better off leasing automobiles, rather than continuing to purchase and retain ownership of these assets. As a consequence, all of the Company's automobiles were sold on December 28, 2018 for $185,000. The leased vehicles were delivered on January 2, 2019.
For the taxation year ending December 31, 2018 calculate the maximum CCA that can be deducted by Bard Ltd. for each CCA class. In addition, calculate the UCC balance for each class. As part of your answer, you should indicate any other tax consequences that would result from the described transactions
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