If a Long-Lived Asset Is Sold Before It Is Fully

question 37

Multiple Choice

If a long-lived asset is sold before it is fully depreciated, and the proceeds received is less than the asset's carrying amount,

• A) a gain on disposal occurs.
• B) a loss on disposal occurs.
• C) there is no gain or loss on disposal.
• D) additional depreciation expense must be recorded.

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Definitions:

Decision

A conclusion or resolution reached after consideration by an individual or authoritative body, especially in a legal context.

Fundamental Justice

A constitutional principle in Canadian law requiring fairness in legislation that affects individuals' rights.

Procedural Fairness

The requirement that legal and administrative processes are conducted in a manner that is fair and impartial to all parties involved.

Administrative Tribunal

A specialized government body empowered to adjudicate disputes, make administrative decisions, and review administrative actions.