If the selling price of an asset at disposal is less than its book value,then the after-tax cash flow is the selling price minus the tax on the gain.

Question

Quizplus · Accepted Answer

If the selling price of an asset at disposal is less than its book value, there is a loss, not a gain, so there is no tax on the gain. Instead, the after-tax cash flow would be the selling price possibly adjusted for the tax benefit from the loss, if applicable.

If the Selling Price of an Asset at Disposal Is