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What is Replacement Cost?
13. What is Replacement Cost?
- Any cost that has not yet been charged to the expense
- The amount of money a business must currently spend to replace an essential asset
- Maintaining an account tied to a certain asset
- The value of a company according to the stock market
Answer: B) The amount of money a business must currently spend to replace an essential asset
Explanation:
Replacement cost is a term alluding to how much cash a business should at present spend to supplant a fundamental resource like a land property, venture security, a lien, or another thing, with one of the equivalents of higher worth.