Recording the adjusting entry for depreciation has the same effect as recording the adjusting entry for
A) an unearned revenue.
B) a prepaid expense.
C) an accrued revenue.
D) an accrued expense.

Question

Quizplus · Accepted Answer

Recording the adjusting entry for depreciation decreases the book value of the asset (through accumulated depreciation) and recognizes the expense. This is similar to the adjustment for a prepaid expense, where the expense is recognized as it is incurred over time, reducing the asset (prepaid expense) and increasing an expense account.

Recording the Adjusting Entry for Depreciation Has the Same Effect