The cash inflow effect of a disposal at a gain is equal to the _____.

Question

Quizplus · Accepted Answer

The cash inflow effect of a disposal at a gain is equal to the selling price minus the tax paid. This is because the selling price represents the cash received from the sale, and the tax paid is deducted from that amount. The gain on the sale is then calculated after taking into account any other costs associated with the sale (such as transaction fees or commissions). Therefore, the cash inflow effect is equal to the selling price minus the tax paid.

The Cash Inflow Effect of a Disposal at a Gain