The Gain or Loss on the Sale of a Plant

question 196

Multiple Choice

The gain or loss on the sale of a plant asset is determined by comparing the market value of assets received with the ________ of asset sold.

• A) book value
• B) residual value
• C) original cost
• D) salvage value

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Definitions:

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including materials, labor, and overhead.

Weighted-Average

A calculation that takes into account the varying degrees of importance of the numbers in a data set, giving more weight to some numbers than others.

Cost of Goods

The total expense incurred to create products or services sold by a company, including labor, materials, and overhead.