If a firm sells an asset for less than its book value, ____.
A) there are no tax consequences
B) the loss is treated as lost depreciation
C) the loss reduces depreciation expenses
D) the loss may be used to offset operating income

Question

Quizplus · Accepted Answer

When a firm sells an asset for less than its book value, the loss incurred on the sale can be used to offset operating income for tax purposes, potentially reducing the firm's taxable income.

If a Firm Sells an Asset for Less Than Its