The Accumulated Depreciation Account Is Credited When

question 120

Multiple Choice

The Accumulated Depreciation account is credited when

• A) An asset is traded for a similar asset
• B) A new asset is purchased
• C) The depreciation expense for the year is recorded
• D) An asset is traded for a dissimilar asset

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Definitions:

Return on Inventory

A financial metric used to assess how effectively a company generates profits from its inventory investments.

Return on Stockholders' Equity

A financial ratio that measures the profitability of a corporation in relation to stockholders' equity, indicating how effectively equity is used to generate profits.

Asset Management Ratios

Those ratios—accounts receivable turnover, average collection period, inventory turnover, and asset turnover—which measure how effectively a company uses its assets.

Company's Ability

A broad concept referring to a business's capacity to execute its strategies and achieve its objectives effectively.