Which of the following statements about disposal of long-lived assets is not correct?
A)The gain or loss resulting from the disposal of a long-lived asset always appears below the "Income from Operations" line on the income statement.
B)A journal entry is usually needed to update depreciation expense on a long-lived asset at the time of disposal.
C)A company may dispose of long-lived assets by selling them,trading them in on new assets,or by scrapping them.
D)The amount of the gain or loss on disposal of a long-lived asset before the end of its useful life will be influenced by the depreciation method that had been used.

Question

Quizplus · Accepted Answer

Disposal of a long-lived asset usually requires two entries - one to update the Depreciation Expense and Accumulated Depreciation account to the date of the disposal,and another entry to record the disposal.Any gain or loss (difference between the value of any items received and the book value of the items given up)is often reported as an operating expense above the "Income from Operations" line on the income statement.

Which of the Following Statements About Disposal of Long-Lived Assets