Accumulated Depreciation is:a. contra asset account b. is used to show the amount of cost expiration of intangibles c. is the same as Depreciation Expense d. is used to show the amount of cost expiration of natural resources

Question

Berry

Business

7 November, 18:38

Accumulated Depreciation is:a. contra asset account b. is used to show the amount of cost expiration of intangibles c. is the same as Depreciation Expense d. is used to show the amount of cost expiration of natural resources

+1

Answers (2)

Know the Answer?

Gabrielle Combs · Answer 1

a) Contra Asset Account

Explanation:

Its is an asset account with a negative (Credit) balance to show the amount of the Accumulated Depreciation charged on a particular Asset to match the initial cost.

Eaton · Answer 2

The correct answer is A, contra asset

Explanation:

A contra asset is a negative asset account which is set off against the asset to which is related.

The depreciation on assets are not posted to the asset account because the asset account is only meant to show the initial cost of the asset, but the true value of the asset at each reporting needs to be shown.

The way out is to set the balance in accumulated depreciation account (contra asset) against the balance in the asset account in order to ascertain the asset net book value.