When Equipment That Is Fully Depreciated Is Discarded

question 39

Multiple Choice

When equipment that is fully depreciated is discarded:

• A) debit the original cost of the asset.
• B) credit the balance of Accumulated Depreciation.
• C) debit Accumulated Depreciation and credit Equipment.
• D) None of the above answers are correct.

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Definitions:

Mortgage Payable

A long-term liability representing the amount owed on a property mortgage, which is to be paid back over a period.

Noncash Investing

Investing activities that do not involve cash transactions, often including exchanges of noncash assets or liabilities for other noncash assets or liabilities.

Noncash Investing

Investment activities that do not involve a direct outlay of cash, such as acquiring assets through a lease or earning stock in exchange for a service.