wasting assets other than chattels

When Harry bought the copyright, he brought 20 years of useful life of the asset before the copyright expires. When he sold the copyright, he already used up 4 Years, therefore he sold the copyright with 20-4=16 years of useful life. That is the figure what you have to use for the pro rata calculation. Sales proceeds of the copyright(useful for 16 years) 22,000 Less: Cost ( 16/20 * 20,000 ) 16,000 --------------- Capital Gain 6,000

What you have calculated, danique is the reduction in the allowable cost (the amount used by Harry) whereas Vanda has computed directly the amount of allowable (unexpired) cost.