A loss is recorded on the sale of property,plant,and equipment when:

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A loss is recorded on the sale of property, plant, and equipment when the asset's book value is greater than the amount of cash received from the sale. This means that the asset was sold for a price lower than its book value and the company incurred a loss as a result. Choice A is incorrect because a gain is recorded when an asset is sold for a price greater than its book value. Choice B is incorrect because if the book value is less than the balance in Accumulated Depreciation, it means that the asset has been fully depreciated and there is no loss or gain to record on the sale. Choice D is also incorrect because GAAP allows for the recording of losses on the sale of property, plant, and equipment.

A Loss Is Recorded on the Sale of Property,plant,and Equipment