What Happens to the Accounting Equation When the Adjustment for Depreciation

question 114

Multiple Choice

What happens to the accounting equation when the adjustment for depreciation expense for the accounting period is recorded?

• A)assets decrease and stockholders' equity decreases
• B)assets increase and stockholders' equity increases
• C)assets decrease and liabilities decrease
• D)liabilities increase and stockholders' equity decreases

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Definitions:

Inorganic Substance

A chemical compound that lacks carbon-hydrogen bonds, typical of non-living systems, such as minerals and metals.

Iodide Ions

Negatively charged ions of iodine, essential for thyroid gland function and hormone production.

Calcium Ions

Electrically charged calcium atoms that play a crucial role in various cellular processes including muscle contraction, neurotransmission, and enzyme activity.

Acid

A substance that donates hydrogen ions or protons and accepts electrons, often associated with a sour taste and capable of turning blue litmus paper red.