What will be the impact in accounting equation for recording depreciation of asset?

Assets - Increase
Liabilities - No effect
Capital - Decrease

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Assets - Decrease
Liabilities - Increase
Capital - No effect

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Assets - No effect
Liabilities - Decrease
Capital - Increase

No worries! We‘ve got your back. Try BYJU‘S free classes today!

Assets - Decrease
Liabilities - No effect
Capital - Decrease

Right on! Give the BNAT exam to get a 100% scholarship for BYJUS courses

Open in App

Solution

The correct option is D
Assets - Decrease
Liabilities - No effect
Capital - Decrease

Depreciation of asset will decrease the value of assets and also decreases capital as it is an expense.

Suggest Corrections

Similar questions

Give an example for each of the following types of transaction.
(i) Increase in one asset, decrease in another asset.
(ii) Increase in asset, increase in liability.
(iii) Increase in asset, increase in owner's capital.
(iv) Decrease in asset, decrease in liability.
(v) Decrease in asset, decrease in owner's capital.
(vi) Decrease in liabilities, increase in owner's capital.
(vii) Increase in one liability, decrease in another liability.
(viii) Increase in liabilities, decrease in owner's capital.

Q. Give one example of each of the following transactions:
(i) Increase in an asset and a liability.
(ii) Decrease in an asset and a liability.
(iii) Increase in assets and capital.
(iv) Decrease in assets and capital.

If the total liabilities of a business decrease by Rs 5000 what will be the effect on total assets? (assuming the amount of capital remain same).

Which statement shows the increase and decrease in various assets, liabilities and capital in two or more balance sheets of the same business enterprise on different dates?

Which among the following statement(s) is/ are correct?

Codes :

1 only
3 only
1 and 2 only
2 and 3 only

Join BYJU'S Learning Program

What will be the impact in accounting equation for recording depreciation of asset?

The correct option is D Assets - Decrease Liabilities - No effect Capital - Decrease Depreciation of asset will decrease the value of assets and also decreases capital as it is an expense.

The correct option is D
Assets - Decrease
Liabilities - No effect
Capital - Decrease

Depreciation of asset will decrease the value of assets and also decreases capital as it is an expense.