When a Company Sells an Asset at a Gain, Which

question 82

Multiple Choice

When a company sells an asset at a gain, which of the following is true?

• A) Proceeds from the sale exceeded the historical cost of the asset on the statement of financial position.
• B) Proceeds from the sale were less than the book value of the asset on the statement of financial position.
• C) Proceeds from the sale exceeded the book value of the asset on the statement of financial position.
• D) Proceeds from the sale are equal to the historical cost of the asset on the statement of financial position.

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Definitions:

Current Liabilities

Short-term financial obligations that are due within one year or within the normal business cycle of a company.

Consolidated Balance Sheet

A comprehensive financial statement presenting the total assets, liabilities, and shareholder equity of a parent company and its subsidiaries as a single entity.

Common Shares

Equity securities that represent ownership in a corporation, granting voting rights and a share in the company's profits through dividends.

Equity Method

An accounting technique used for recording investments in which the investor has significant influence over the investee, but not full control.