Which of the following explanations might satisfy an auditor who discovers significant debits to an accumulated depreciation account?
A) Prior years' depreciation charges were erroneously understated.
B) There were numerous fixed asset retirements during the year.
C) There were numerous fixed asset purchases during the year.
D) A reserve for possible loss on retirement has been recorded.

Question

Quizplus · Accepted Answer

When fixed assets are retired, the accumulated depreciation account is debited to remove the depreciation associated with those assets from the books.

Which of the Following Explanations Might Satisfy an Auditor Who