To Determine If There Is a Gain or Loss on the Sale

question 50

Multiple Choice

To determine if there is a gain or loss on the sale of an asset,you must compare:

• A) sales price and book value.
• B) sales price and salvage value.
• C) sales price and original cost.
• D) book value and salvage cost.

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Definitions:

Functional Currency

The primary currency of the primary economic environment in which an entity operates and carries out its transactions.

Current Rate Method

A method of foreign currency translation where all financial statement items are converted at the current exchange rate.

Temporal Method

An accounting method used to translate foreign currency financial statements into the parent company's currency, where exchange rates vary depending on the nature of the financial statement item being translated.

Malaysian Palm Oil

A commodity produced from the fruit of the oil palm primarily in Malaysia, used in a variety of food products, cosmetics, and biofuels.