What is the unforeseen obsolescence of fixed capital assets during production process known as?
Answer & explanation
Correct answer: option 3
The correct answer is option 3: Capital loss
Normal wear and tear of the fixed capital assets is known as depreciation of the asset. It is a gradual process which is spread over a long period of time and is foreseen. Whereas, the unforeseen obsolescence of fixed capital assets during production process is known as capital loss.