Question

When recording the adjusting entry for depreciation expense, the fixed asset account balance a.stays the same. b.is decreased by its book value. c.is decreased by the amount of the depreciation. d.is increased by the amount of the depreciation.

Answer 1

The recording of the adjusting entry for depreciation expense ensures that the fixed asset account balance a. stays the same.

What is a fixed asset account?

A fixed asset account is a record of a long-term asset used in the production of goods and services. Fixed (tangible) asset accounts form one aspect of the asset side of the balance sheet.

The adjusting entry of the depreciation expense appears on the credit side of the Accumulated Depreciation account, which is a summary of the previous depreciation expenses.

Thus, the recording of the adjusting entry for depreciation expense ensures that the fixed asset account balance a. stays the same.

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