If Disposal of a Plant Asset Occurs During the Year

question 109

Multiple Choice

If disposal of a plant asset occurs during the year depreciation is

• A) not recorded for the year.
• B) recorded for the whole year.
• C) recorded for the fraction of the year to the date of the disposal.
• D) not recorded if the asset is scrapped.

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Definitions:

Journal Entries

The basic method of recording financial transactions in accounting, which involves making entries to accounts in a double-entry bookkeeping system.

Cash Short And Over

An accounting term referring to a discrepancy between the amounts of cash available at the end of a period and the expected amount, which could be more (over) or less (short).

Office Supplies

Items such as pens, paper, staplers, and other materials used in an office setting for daily operations and not directly associated with the manufacturing process.

Bank Reconciliation

A process used to verify the accuracy of bank statements with a company's financial records, identifying any discrepancies.