How much will Gertrude recover for her stolen television using the actual cash value method?

To determine how much Gertrude will recover for her stolen television using the actual cash value (ACV) method, it is essential to understand what ACV entails. Actual cash value is generally defined as the replacement cost of the item minus depreciation. It represents the market value of the item at the time of loss, reflecting its current worth rather than its original purchase price.

If Gertrude’s television had, for example, a replacement cost of $900, but it has depreciated over time, then its current value would be less than that amount. Assuming that the depreciation amounts to $300, Gertrude would be entitled to receive the replacement cost of $900 minus the depreciation, resulting in a recovery of $600.

Once this value is established, any applicable deductible is then subtracted from it to arrive at the final payout amount for Gertrude. The question specifies that the recovery is to be adjusted for the deductible; however, the base amount coming from the actual cash value calculation is crucial in understanding how much she can initially expect to recover. Given that the estimated cash value comes to $600 before the deductible is applied, this makes the amount listed as 'B' the correct response to the question.