When an Asset Is Fully Depreciated

question 166

Multiple Choice

When an asset is fully depreciated:

• A) the total depreciation is equal to the accumulated depreciation, and the asset has reached the end of its actual useful life.
• B) the book value is equal to the salvage value, and the asset has reached the end of its estimated useful life.
• C) the depreciable cost is equal to the salvage value, and the asset is of no further use to the company.
• D) the book value is zero, and the asset has no market value.

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Definitions:

Marginal Revenue

The additional income that a firm receives from selling one more unit of a good or service, crucial for decision-making in production levels.

Natural Monopoly

A market condition where a single firm can supply a product or service to an entire market at a lower cost than what would be possible if there were multiple firms due to economies of scale.

Production

The process of creating goods or services through the combination of labor, materials, and technology, which contributes to economic output.

Maximum Profit

The highest possible financial gain that a company can achieve in a given period under existing conditions.