If disposal of a plant asset occurs during the year, depreciation expense is

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If disposal of a plant asset occurs during the year, depreciation expense is recorded for the fraction of the year to the date of the disposal. This is because depreciation represents the allocation of the asset's cost over its useful life, and if the asset is disposed of before the end of its useful life, only a portion of its cost should be allocated as depreciation expense.

If Disposal of a Plant Asset Occurs During the Year