A gain or loss on disposal of a plant asset is determined by comparing the

Question

Quizplus · Accepted Answer

The book value of a plant asset is its original cost minus any accumulated depreciation. To determine the gain or loss on disposal of the asset, the book value (cost minus depreciation) is compared to the proceeds received from selling the asset. If the proceeds are higher than the book value, there is a gain. If the proceeds are lower than the book value, there is a loss. Therefore, choice D is the correct answer.

A Gain or Loss on Disposal of a Plant Asset