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asset class	Eligible depreciable assets are grouped into specified asset classes by CRA. Each asset class has a prescribed CCA rate. (See page(s) 251)
capital cost allowance	The amount of write-off on depreciable assets allowed by Canada Revenue Agency (CRA) against taxable income.
declining balance	This is computed by applying the depreciation rate to the asset balance for each year.
depreciation tax shield	Reduction in taxes attributable to the depreciation allowance. (See page(s) 249)
half-year rule	Only one-half of the purchase cost of the asset is added to the asset class and used to compute CCA in the year of purchase. (See page(s) 253)
net working capital	Current assets minus current liabilities. (See page(s) 245)
opportunity cost	Benefit or cash flow forgone as a result of an action. (See page(s) 244)
recaptured depreciation	If the sale of an asset causes a negative balance in an asset class, the amount of the negative balance is known as recaptured depreciation and is added to taxable income. (See page(s) 254)
straight-line depreciation	Constant depreciation for each year of the asset’s accounting life. (See page(s) 252)
terminal loss	When an asset class has a positive balance following the disposal of all assets in the class, this balance is called terminal loss. The UCC of the asset class is set to zero after a terminal loss is recognized. (See page(s) 254)
undepreciated capital cost (UCC)	The balance remaining in an asset class that has not yet been depreciated in that year. (See page(s) 251)