The term inadequacy,as it relates to the useful life of an asset,refers to:
A)The inability of a company's plant assets to meet the company's demands.
B)An asset that is worn out.
C)An asset that is no longer useful in producing goods and services.
D)The condition where the salvage value is too small to replace the asset.
E)The condition where the asset's salvage value is less than its cost.

Question

Quizplus · Accepted Answer

Inadequacy, in the context of an asset's useful life, refers to the situation where a company's plant assets are no longer capable of meeting the company's production demands or operational needs. This could be due to the asset's capacity, technology, or functionality becoming obsolete or insufficient, rather than the asset being physically worn out or its salvage value considerations.

The Term Inadequacy,as It Relates to the Useful Life of an Asset,refers