The balance in the Accumulated Depreciation account represents the Group of answer choicescash fund to be used to replace plant assets.amount to be deducted from the cost of the plant asset to arrive at its fair market valueamount charged to expense in the current period.amount charged to expense since the acquisition of the plant asset.
Question
The balance in the Accumulated Depreciation account represents the Group of answer choicescash fund to be used to replace plant assets.amount to be deducted from the cost of the plant asset to arrive at its fair market valueamount charged to expense in the current period.amount charged to expense since the acquisition of the plant asset.
Solution
The balance in the Accumulated Depreciation account represents the amount charged to expense since the acquisition of the plant asset.
Here's why:
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Accumulated Depreciation is a contra asset account, meaning it is paired with and reduces the value of the asset it is associated with (in this case, a plant asset).
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Over time, as the plant asset is used, its value decreases or depreciates. This depreciation is an expense for the company.
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Each accounting period, the depreciation expense is recorded in the Accumulated Depreciation account.
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Therefore, the balance in the Accumulated Depreciation account represents the total amount of the asset's cost that has been charged to expense since the asset was acquired.
Similar Questions
The balance in the Accumulated Depreciation account represents the
Under the declining balance method, what happens to the depreciation expense over time?Group of answer choicesIt decreases.It remains constant.It increases.It fluctuates based on production levels.
what is depreciation in accounts
The calculation of depreciation using the declining balance method,Group of answer choicesmultiplies a constant percentage times the previous year's depreciation expense.multiplies a declining percentage times a constant book value.yields an increasing depreciation expense each period.ignores salvage value in determining the amount to which a constant rate is applied.
Accumulated Depreciation has a normal balance which indicates that it reduces total assets.
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