When an old asset is sold for exactly its depreciated value, the only taxable income is the difference between the initial cost of the machine and the selling price.

Question

Quizplus · Accepted Answer

When an old asset is sold for exactly its depreciated value, there is no taxable income because the selling price is equal to the remaining undepreciated cost of the machine. Therefore, the difference between the initial cost and selling price is zero.

When an Old Asset Is Sold for Exactly Its Depreciated