Recaptured depreciation and terminal loss occur when:
A)all assets are depreciated over five years.
B)depreciable percentages decline throughout the asset's class life.
C)straight-line depreciation percentages are doubled.
D)a business terminates an asset pool.

Question

Quizplus · Accepted Answer

Recaptured depreciation and terminal loss occur when a business terminates an asset pool. Recaptured depreciation refers to the difference between the total amount deducted for depreciation and the amount that should have been deducted based on the asset's current value at the time it was sold or disposed of. Terminal loss occurs when the proceeds from the sale or disposal of the asset are less than its undepreciated value.

Recaptured Depreciation and Terminal Loss Occur When