In SAP FI Asset Accounting, what does it mean if there is no gain or loss on the retirement of an asset?

Introduction / Context:
When an asset is retired in SAP FI Asset Accounting, the system compares the net book value of the asset with any proceeds from sale to determine whether there is a gain or loss. Understanding this relationship is a basic but important concept in both accounting and SAP configuration. Certification exams often test whether you can correctly interpret the situation in which there is no gain or loss recorded on an asset retirement.

Given Data / Assumptions:

• The asset is being retired either by sale or by similar transaction.
• Net book value is defined as acquisition and production cost minus accumulated depreciation and impairment.
• Sales revenue is the actual amount received from the purchaser at the time of retirement.
• The question states that there is no gain or loss on the retirement.

Concept / Approach:
From an accounting perspective, gain or loss on asset retirement is calculated as sales proceeds minus net book value at the retirement date. If proceeds are greater than net book value, a gain is recorded; if they are lower, a loss is recorded. When there is no gain or loss, the only possibility is that sales proceeds equal net book value exactly. SAP follows this same logic in FI Asset Accounting and posts the retirement without additional gain or loss amounts if the two values are identical.

Step-by-Step Solution:
Step 1: Recall the definition of net book value as acquisition costs minus accumulated depreciation at the retirement date. Step 2: Recognize that gain or loss equals sales revenue minus net book value. Step 3: Set gain or loss equal to zero according to the question condition. Step 4: Solve the equation sales revenue minus net book value equals zero, which leads to sales revenue equals net book value. Step 5: Match this conclusion to the answer options and select option a.

Verification / Alternative check:
Consider an asset with acquisition cost of 10,000 and accumulated depreciation of 7,000 at the time of retirement. The net book value is therefore 3,000. If the asset is sold for 3,000, then sales revenue equals net book value, and no gain or loss arises. If, however, the asset is sold for 4,000, then there is a gain of 1,000; if it is sold for 2,000, there is a loss of 1,000. This simple numeric example confirms that zero gain or loss only occurs when sales revenue equals net book value.

Why Other Options Are Wrong:
Option b suggests that any revenue on a fully depreciated asset is recorded as pure gain, which would contradict the condition of no gain or loss. Option c claims that a scrapping without revenue always leads to a loss equal to net book value, which again contradicts the no gain or loss condition. Option d is incorrect because it is entirely possible and valid that a retirement produces neither gain nor loss. Option e is wrong because if revenue were higher than acquisition and production cost, the gain would be larger than zero, not zero.

Common Pitfalls:
Learners sometimes confuse net book value with acquisition cost or assume that a fully depreciated asset must always produce a gain when sold. Another common error is to forget that gain or loss is based on net book value at the time of retirement rather than original cost. Keeping the simple relationship gain or loss equals revenue minus net book value firmly in mind makes this type of question straightforward.

Final Answer:
If there is no gain or loss on the retirement of an asset, the sales revenue from the asset retirement is exactly equal to the net book value of the asset at the time of retirement.