As the usefulness of a plant asset expires,
A)an amount is transferred from one asset account to another.
B)a related expense account is reduced.
C)a liability is created.
D)the cost of the asset is allocated to an expense account.

Question

Quizplus · Accepted Answer

When the usefulness of a plant asset expires, the cost of the asset is allocated to an expense account. This is known as depreciation, which is the gradual cost allocation of a long-term asset over its useful life. This allows businesses to match the cost of using an asset with the revenue it generates during that time. Therefore, the correct answer is D.

As the Usefulness of a Plant Asset Expires