Ben George, Inc

question 24

Multiple Choice

Ben George, Inc. has an unadjusted balance in Accumulated Depreciation─Truck of $9,000 as of December 31, 2010. This relates to a Truck purchased for $15,000 with an expected useful life of 5 years that is depreciated using the straight line method. After recording the depreciation expense for 2011, the adjusted balance in the Accumulated Depreciation─Truck account as of December 31, 2011 is:

• A)$15,000.
• B)$12,000.
• C)$3,000.
• D)$1,000.

---

Definitions:

Deadweight Losses

Losses in total surplus that occur when a market is not in competitive equilibrium, often due to taxes or subsidies.

Economic Efficiency

A situation where all resources are allocated in a way that maximizes the total benefit to society or minimizes waste.

External Cost

A cost that a transaction or activity imposes on a party who is not involved in the transaction, often not reflected in market prices.

Negative Externality

A cost that affects a party who did not choose to incur that cost, often associated with environmental, health, and safety concerns of public and private actions.