Losses on the cash sale of capital assets:

Question

Quizplus · Accepted Answer

Losses on the cash sale of capital assets occur when the cash proceeds from the sale are less than the carrying value (or book value) of the asset. Therefore, the correct option is C, which states that the losses are the excess of the carrying value of the asset over the cash proceeds. Option A is incorrect because it describes the calculation for gains on the cash sale of capital assets. Option B is incorrect because the market value of the asset is not relevant in calculating the loss. Option D is also incorrect because it describes the calculation for impairments, which is not the same as a loss on the cash sale of an asset.

Losses on the Cash Sale of Capital Assets