The portion of a non-current asset, such as plant and equipment, which is transferred to an expense account during an accounting period, is known as:
A) carrying amount.
B) accumulated depreciation.
C) depreciation.
D) contra asset.

Question

Quizplus · Accepted Answer

Depreciation is the portion of a non-current asset that is transferred to an expense account during an accounting period. Option A is incorrect because carrying amount is the original cost of the asset less accumulated depreciation. Option B is incorrect because accumulated depreciation is the total amount of depreciation charged to the asset since its acquisition. Option D is incorrect because a contra asset is an account that offsets the balance in another asset account.

The Portion of a Non-Current Asset, Such as Plant and Equipment