When a Company Discards Machinery That Is Fully Depreciated, This

question 74

Multiple Choice

When a company discards machinery that is fully depreciated, this transaction have which of the following effect on the company's accounts?

• A) decrease Accumulated Depreciation; decrease Machinery
• B) increase Machinery; increase Accumulated Depreciation
• C) increase Cash; increase Accumulated Depreciation
• D) increase Depreciation Expense; increase Accumulated Depreciation

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Definitions:

Federal Reserve System

The central banking system of the United States, responsible for implementing monetary policy and regulating the banking industry.

M1

A category of the money supply that includes all physical money like coins and currency, as well as demand deposits and other liquid assets held by the central bank.

Double Coincidence of Wants

A condition in barter economies where two parties each hold an item the other wants, making it possible for an exchange to occur without a common medium of exchange.

Barter Situation

A trade system where goods or services are exchanged directly for other goods or services without the use of money as a medium of exchange.