If the estimated amount of depreciation on equipment for a period is Rs. 2000, the adjusting entry to record depreciation would be ________.
If the estimated amount of depreciation on equipment for a period is Rs. 2000, the adjusting entry to record depreciation would be ________.
The correct option is A debit depreciation expense Rs.2000; credit equipment Rs.2000
Reduction in value of tangible fixed assets due to normal usage,
wear and tear, new technology or unfavorable market conditions is called
Depreciation. Journal entry for depreciation depends on whether the provision
for depreciation/accumulated depreciation account is maintained or not.
Assets such as plant and machinery, buildings, vehicles, furniture etc. which are
expected to last more than one year, but not for an infinite number of years
are subject to depreciation. Below journal entry for depreciation assumes that
depreciation is charged directly to the asset account.
Journal entry for depreciation:
Depreciation expense
A/c Dr.
To Equipment A/c
Reduction in value of tangible fixed assets due to normal usage, wear and tear, new technology or unfavorable market conditions is called Depreciation. Journal entry for depreciation depends on whether the provision for depreciation/accumulated depreciation account is maintained or not.
Assets such as plant and machinery, buildings, vehicles, furniture etc. which are expected to last more than one year, but not for an infinite number of years are subject to depreciation. Below journal entry for depreciation assumes that depreciation is charged directly to the asset account.
Journal entry for depreciation:
Depreciation expense A/c Dr.
To Equipment A/c
