Whenever a Plant Asset Is Sold or Otherwise Disposed Of

question 144

True/False

Whenever a plant asset is sold or otherwise disposed of, the first step is to bring the depreciation up to date.

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Definitions:

Tax Rate

The income proportion taken as tax from either individuals or corporations.

Variable Cost

Expenses that fluctuate in direct proportion to the volume of production or commercial operations.

Contribution Margin

The amount by which the sale of a product or service exceeds its production cost, used to cover fixed costs and generate profit.

Depreciation Expense

Distributing the expense of a physical asset across its lifespan.