The Gain or Loss on the Disposal of Equipment Is

question 3

Multiple Choice

The gain or loss on the disposal of equipment is determined by ________.

• A) subtracting the book value of the old equipment to the cost of the new equipment
• B) subtracting the disposal value of the old equipment to the book value of the old equipment
• C) subtracting the book value of the old equipment from the cash received for the old equipment
• D) subtracting the book value of the old equipment from the cost of the new equipment

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Definitions:

Shareholder's Derivative Suit

A legal action initiated by a shareholder on behalf of the corporation against a third party, often the corporation's executives or directors, for mismanagement or fraud.

Corporate Directors

Individuals elected by shareholders to oversee the management of a corporation and ensure that it is being run in accordance with their interests.

Corporation

A legal entity that is separate and distinct from its owners, capable of owning property, carrying on business, incurring liabilities, and suing or being sued.

Cash Tender Offer

A type of takeover in which the aggressor corporation offers to pay the target shareholders cash for their stock.