Question

When a firm disposes of a long-lived asset before the end of its useful life, the difference between the net book value of the asset and the sale proceeds is a gain or loss from a discontinued item.

Answer 1

Answer:

FALSE

Explanation:

When a firm disposes of a long-lived asset, that is not a discontinued operation, before the end of its useful life, the gain or loss recognized on the sale shall be included in income from continuing operations before income taxes in the income statement of a business entity. It doesn't represent a gain or loss from a discontinued item.