At What Amount Should the Equipment (Net of Depreciation) Be

question 86

Multiple Choice

At what amount should the equipment (net of depreciation) be included in the consolidated balance sheet dated December 31, 2017?

• A) $105,000.
• B) $100,000.
• C) $ 95,000.
• D) $ 80,000.
• E) $ 85,000.

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Definitions:

Marginal Cost

Incremental cost incurred when one more unit of a product or service is produced.

Total Variable Cost

The sum of expenses that change in proportion to the activity or volume of production.

Average Variable Cost

The total variable costs divided by the quantity of output produced; it fluctuates with changes in output.

Marginal Cost

The increase or decrease in the total cost that arises from producing one additional unit of a good or service.