The adjusting entry to record depreciation for the company automobile would be:
A) debit Cash; credit Accumulated Depreciation, Automobile.
B) debit Accumulated Depreciation, Automobile; credit Automobile.
C) debit Depreciation Expense, Automobile; credit Accumulated Depreciation, Automobile.
D) debit Depreciation Expense, Automobile; credit Automobile.

Question

Quizplus · Accepted Answer

The correct adjusting entry to record depreciation involves debiting (increasing) Depreciation Expense, Automobile to reflect the expense on the income statement, and crediting (increasing) Accumulated Depreciation, Automobile to reflect the accumulated depreciation on the balance sheet. This entry does not decrease the original cost of the automobile recorded in the asset account but records the expense and accumulates the total depreciation separately.

The Adjusting Entry to Record Depreciation for the Company Automobile