Assume that in all of the following situations the company's fiscal year is the calendar year and that recapture arose due to the disposition of the asset. In which situation would the company NOT be permitted to defer the recognition of the recapture?

Question

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In option D, a recapture arises due to the sale of the warehouse, which cannot be deferred because the company did not replace the asset with a similar one. In options A, B, and C, the assets were destroyed or stolen, and the insurance proceeds were used to replace them with similar assets. Therefore, in these situations, the company would be able to defer the recognition of the recapture.

Assume That in All of the Following Situations the Company's