If an Asset Is Sold

question 110

Multiple Choice

If an asset is sold:

• A) depreciation must be recorded to the date of sale.
• B) the cost of the asset is compared to the selling price to determine any gain or loss.
• C) the journal entry to record the sale will include a credit to cash.
• D) for a gain, total assets remain the same and total equity increases.

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Definitions:

Trade Union

An organization formed by workers from related fields that aims to protect their rights and interests through collective bargaining.

Post-employment Benefit Plan

A financial arrangement designed to provide benefits to employees after their employment has ended, such as pensions.

Subsidiary

A company that is controlled by another company, usually by owning more than 50% of its voting stock.