When there is an exchange of assets, and no cash is paid, there will always be a gain or loss on disposal of property, plant, and equipment recorded.

Question

Quizplus · Accepted Answer

The recognition of a gain or loss on disposal of property, plant, and equipment in an exchange transaction depends on whether the exchange has commercial substance and the fair value of the assets exchanged can be reliably measured. If these conditions are not met, a gain or loss might not be recognized.

When There Is an Exchange of Assets, and No Cash