Question

Obsolescence is concerned with _________.

• A. change in taste and habits
• B. slump in market price
• C. technological change
• D. economic slow down

Answer 1

Answer: (C)

technological change

Obsolescence is a notable reduction in the utility of an inventory item or fixed asset. The determination of obsolescence typically results in a write-down of the inventory item or asset to reflect its reduced value. Obsolescence can arise when there are less expensive alternatives in the marketplace, or when customer preferences change or changes in technology and many more external factors lead to obsolescence.