A Loss on Disposal of an Item of Property, Plant

question 131

True/False

A loss on disposal of an item of property, plant and equipment occurs if the cash proceeds received from the asset sale is less than the asset's carrying amount.

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Definitions:

Accrued Expense

An expense that has been incurred but not yet paid, recognized on the financial statements.

Long-Lived Asset

An asset expected to provide economic benefits over a period longer than one year, such as buildings or machinery.

Income Statement

A financial statement that reports a company's financial performance over a specific accounting period, detailing revenue, expenses, and net income.

Net Income

The total profit or loss of a company after all revenues, costs, and expenses have been accounted for, often referred to as the bottom line.