The expense created by allocating the cost of plant and equipment to the periods in which they are used, representing the expense of using the assets, is called:
A)The cash basis of accounting.
B)Allowance for depreciation.
C)Accumulated depreciation.
D)Depreciation.
E)The matching principle.

Question

Quizplus · Accepted Answer

Depreciation represents the expense of using an asset and is the process of allocating the cost of plant and equipment to the periods in which they are used.

The Expense Created by Allocating the Cost of Plant and Equipment