Which of the Following Statements About Derecognition of an Asset

question 49

Multiple Choice

Which of the following statements about derecognition of an asset is true?

• A) Derecognition requires that the firm remove the asset acquisition value from the balance sheet but not the related accumulated depreciation.
• B) Derecognition increases or decreases the balance of the Allowance for Derecognition account.
• C) Before a gain or loss on derecognition is recognized, the firm must always first recognize current period depreciation expense.
• D) A loss on derecognition occurs when the amount of cash proceeds (if any) is less than the acquisition cost of the asset.

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Definitions:

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