Final answer:
A loss will result when the proceeds of the sale are less than the book value of the asset.
Step-by-step explanation:
When selling a piece of equipment for cash, a loss will result when the proceeds of the sale are less than the book value of the asset. This statement is True.
Book value is the value of an asset as recorded on a company's balance sheet. If the proceeds from the sale are less than the book value, it means that the asset is being sold at a loss.
For example, if a company's balance sheet shows that a piece of equipment has a book value of $10,000, but it is sold for only $8,000, a loss of $2,000 is incurred.