If a Corporation Sells Certain Capital Equipment for More Than

question 54

Multiple Choice

If a corporation sells certain capital equipment for more than its initial purchase price, the difference between the sale price and the purchase price is called a(n) ________.

• A) ordinary gain
• B) revenue gain
• C) capital gain
• D) abnormal gain

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Definitions:

Work in Process

Inventory that includes all materials, labor, and overhead costs incurred for products that are in the production process but not yet completed.

Debit Balance

An amount that reflects a surplus of debits over credits in an account, often indicating assets or expenses.

Raw Materials

Basic substances in their natural, modified, or semi-processed states, used as inputs in manufacturing or production.

Production Supervisor

A professional responsible for overseeing the daily operations of manufacturing processes, ensuring that production goals are met efficiently and safely.