Blipton International

a) Time 0, time 1 etc. are not years - they are points in time that are 1 year apart. The investment is on 31 December 2009 - time 1. The capital allowances will be calculated at the end of the accounting period when the money is spent - so will be calculated on 31 December 2009. Given that there is no delay in tax, they will get the benefit of the allowances at time 1 as well. b) I only have the original exam question, and in the original question there is no part (d) to the question :-)

But again - there was no part (d) in the original question, and you have not said what the question wanted.

Sorry but I cannot answer questions without seeing the whole question. There was no part (d) in the original exam question, and (unless I am being stupid) I cannot find this question in the BPP Revision Kit either. If it is in the current edition of the BPP Revision Kit, then tell me the number of the question. Otherwise, I am sorry, but you are going to have to ask whoever the publisher is of your Kit.