The gain or loss on disposal of a non-current asset is calculated as the difference between:

Question

Quizplus · Accepted Answer

The gain or loss on disposal of a non-current asset is calculated as the difference between the selling price and carrying amount. This is because carrying amount represents the net book value of the asset at the time of disposal, which includes the original cost of the asset less accumulated depreciation. The selling price, on the other hand, represents the amount for which the asset was sold. The difference between the two reflects the gain or loss incurred on the disposal of the asset.

The Gain or Loss on Disposal of a Non-Current Asset