If an asset is sold before the end of its useful life for more than its...

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If an asset is sold before the end of its useful life for more than its...

If an asset is sold before the end of its useful life for more than its salvage value, the difference between the two amounts is defined as capital gain for tax accounting.
True or False?

business economics

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Answer 1

Answer #1

False . Here salvage value is different from purchase value . Capital gain is obtained when we sell an asset for more than its purchase value .We can't say that salvage value (usually the value obtained after the useful life of an asset is over )is more than purchase value .So it's false .

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Answer 2

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