The auditor is examining the accounting entries made to the accumulated depreciation account during the year and notices a significant number and amounts of debits to the account. Which of the following provides the most logical explanation?
A) large number of asset retirements
B) salvage values were revised downward
C) useful lives were revised downward
D) allocation of fixed overhead was revised

Question

Quizplus · Accepted Answer

The most logical explanation for significant debits to the accumulated depreciation account is a large number of asset retirements. When an asset is retired or disposed of, its accumulated depreciation is debited to remove it from the books, which decreases the accumulated depreciation balance.

The Auditor Is Examining the Accounting Entries Made to the Accumulated