WAEC Accounting 2012 Paper

Concept:Loss on disposal of a fixed asset is an expense of the business.Explanation:When a fixed asset is sold for less than its book value, the difference is a loss.This loss reduces the profit of the business, so it is transferred to the debit side of the profit and loss account.In the journal, the fixed asset is credited, cash and accumulated depreciation are debited, and the balancing loss is debited.At the end of the period, this loss account is closed by debiting the profit and loss account.Answer:Option C: profit and loss account.