When an Asset Is Purchased (Or Disposed Of) at a Time

question 236

True/False

When an asset is purchased (or disposed of) at a time other than the beginning or the end of an accounting period, depreciation is recorded for part of a year so that the year of purchase or the year of disposal is charged with its share of the asset's depreciation.

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Definitions:

Raw Materials

The basic materials from which a product is made, often referred to in the context of manufacturing and production industries.

Assemblers

Individuals or machines that put together components to create a finished product.

Partnership

A legal form of business operation between two or more individuals who share management and profits.

Ratio

A mathematical expression that compares two quantities and shows the relative size of one quantity to the other.