When a Company Sells Used Equipment for a Loss, the Net

question 148

True/False

When a company sells used equipment for a loss, the net profit margin percentage is unaffected.

---

Definitions:

Spinout

Occurs when differential action allows one drive wheel on a slippery surface to spin while the other remains stationary and receives no driving torque. On tandem drive trucks, because of the additional differential action between the drive axles, it is possible to turn a spinning wheel at four times its normal speed. This can take out the interaxle differential or carrier differential. Spinout is a driver abuse failure of differential carriers.

Loss of Traction

A situation where the tires of a vehicle fail to grip the road surface, resulting in loss of control.

Power Divider

Power divider refers to a mechanical device in certain vehicles that evenly distributes power from the engine to multiple axles, enhancing traction and handling.

Tandem Drive

A drive configuration in vehicles where two or more axles are powered, commonly found in heavy vehicles for improved traction and load distribution.