A Company Using the Group Depreciation Method for Its Delivery

question 63

Multiple Choice

A company using the group depreciation method for its delivery trucks retired one of the trucks after the average service life of the group was reached.Cash proceeds were received from a salvage company.The net carrying amount of these group asset accounts would be decreased by the

• A) original cost of the truck.
• B) original cost of the truck less the cash proceeds.
• C) cash proceeds received.
• D) cash proceeds received and original cost of the truck.

---

Definitions:

Long Run

A period of time in which all factors of production and costs are variable, allowing for adjustments in all inputs and outputs.

Long-Run Supply Curves

A graphical representation showing the relationship between the price of a good and the quantity supplied over a longer period, considering adjustments in factors of production.

Purely Competitive

A market structure characterized by many buyers and sellers, all of whom are price takers offering homogenous products.

Downsloping

Characteristic of a curve or line on a graph that shows a decrease in value as it moves from left to right, commonly used in economics to describe demand curves.