Obsolescence

question 189

Multiple Choice

Obsolescence:

• A)Occurs when an asset is at the end of its useful life.
• B)Refers to a plant asset that is no longer useful in producing goods and services with a competitive advantage.
• C)Refers to the insufficient capacity of a company's plant assets to meet the company's productive demands.
• D)Occurs when an asset's salvage value is less than its replacement cost.
• E)Does not affect plant assets.

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Definitions:

Total Spending

Total spending refers to the aggregate amount of money spent by individuals, businesses, and government on goods and services within a specific time frame.

Stock Of Wealth

Refers to the total value of all assets owned by an individual, a company, or a country at a given point in time, excluding liabilities.

Intermediate Goods

Products used in the production process to make other goods and services but not sold directly to consumers.

Manufacture

The process of converting raw materials into finished goods through the use of labor, machines, and chemical processes.