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Why Gain on Disposal on current asset is adjusted with cost of sales in income statement ?
“Current asset” or non-current asset? I think you mean non-current. the reason is because such a gain represents an over-charge of depreciation in prior years, and if depreciation has been charged to cost of sales, then it makes sense to make the adjustment – ie gain on disposal ( or over-depreciation from prior years ) in the cost of sales
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