A loss on disposal of a long-lived asset is reported in the financial statements
A) as an increase to depreciation expense in the income statement.
B) in the operating expenses section of the income statement.
C) as a direct increase to the capital account on the balance sheet.
D) as a direct decrease to the capital account on the balance sheet.

Question

Quizplus · Accepted Answer

A loss on disposal of a long-lived asset is reported in the operating expenses section of the income statement. It is recognized separately from depreciation expense and does not directly affect the capital accounts on the balance sheet.

A Loss on Disposal of a Long-Lived Asset Is Reported