Asked by Carina Campos on Jun 29, 2024
Verified
Accumulated depreciation is shown on the balance sheet as a subtraction from the cost of its related asset.
Accumulated Depreciation
The total amount of a tangible asset's cost that has been allocated as depreciation expense over the asset's useful life, reducing its book value on the balance sheet.
Balance Sheet
A statement that displays the financial condition of a company, detailing assets, liabilities, and the equity of its shareholders at a given time.
- Gain an understanding of depreciation concepts and their treatment in accounting.
- Differentiate amongst various account types impacted by adjustment entries.
Verified Answer
DF
Donesha FerrellJul 05, 2024
Final Answer :
True
Explanation :
Accumulated depreciation represents the amount of a fixed asset's cost that has been allocated to depreciation expense since the asset was put into service. As it is a contra asset account, it is shown as a subtraction from the cost of the related asset on the balance sheet.
Learning Objectives
- Gain an understanding of depreciation concepts and their treatment in accounting.
- Differentiate amongst various account types impacted by adjustment entries.