When a plant asset is sold for a price lower than its book value, there will be a gain.

Question

Quizplus · Accepted Answer

When a plant asset is sold for a price lower than its book value, there will be a loss, not a gain. This is because the book value represents the original cost of the asset minus any accumulated depreciation, and selling it for less than that means that the asset has lost value over time. The loss is recorded on the company's financial statements as an expense.

When a Plant Asset Is Sold for a Price Lower