The Portion of an Asset's Sale Price That Is Above

question 114

Multiple Choice

The portion of an asset's sale price that is above its book value and below its initial purchase price is called ________.

• A) a capital gain
• B) recaptured depreciation
• C) a capital loss
• D) book value

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Definitions:

FIFO Assumption

Stands for First-In, First-Out, an inventory costing assumption where the first items purchased are the first ones to be sold.

Inventory Count

The process of physically counting the items in stock to verify the accuracy of inventory records.

Balance Sheet

A financial statement that shows the assets, liabilities, and stockholders' equity of a company at a specific point in time.

Assets

Resources owned by a business with economic value expected to provide future benefits.