A loss on disposal of a plant asset is reported in the financial statements
A) in the Other Revenues and Gains section of the income statement.
B) in the Other Expenses and Losses section of the income statement.
C) as a direct increase to the capital account on the balance sheet.
D) as a direct decrease to the capital account on the balance sheet.

Question

Quizplus · Accepted Answer

A loss on disposal of a plant asset represents a decrease in the value of the company's assets and is therefore reported in the Other Expenses and Losses section of the income statement. It does not directly affect the capital account on the balance sheet.

A Loss on Disposal of a Plant Asset Is Reported