Consider Each of the Items Below

question 79

Multiple Choice

Consider each of the items below. Place the proper letter in the blank space provided to indicate the nature of the account or accounts to be debited when recording each transaction using the preferred accounting treatment. Prepayments should be recorded in balance sheet accounts. Disregard income tax considerations unless instructed otherwise.
-An improvement, which extended the life but not the usefulness of the asset, cost $6,000.

• A)asset(s) only
• B)accumulated amortization, depletion, or depreciation only
• C)expense only
• D)asset(s) and expense
• E)some other account or combination of accounts

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Definitions:

Diseconomies of Scale

The point at which a company or business grows so large that the costs per unit increase, leading to inefficiency and increased production costs.

Economies of Scale

Cost benefits that organizations acquire by scaling up their operations, wherein the cost for each unit produced tends to fall as the scale of operation enlarges.

Min Per-unit Costs

The lowest possible cost of producing one unit of good or service, achieved through efficient use of resources and optimal production scale.