Which of the Following Statements Is True Regarding Depreciation

question 16

Multiple Choice

Which of the following statements is true regarding depreciation?

• A)Depreciation is a valuation concept; that allocates cost to reflect the actual change in the value of the asset.
• B)Depreciation allocates the cost of a long-lived asset to the accounting periods over which it is used.
• C)Depreciation expense will typically will be shown on the statement of financial position.
• D)Accumulated depreciation has a normal debit balance.

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Definitions:

Disbursements

Payments made by a business, often related to its operational expenses.

Financing

The process of providing funds for business activities, making purchases, or investing.

Minimum Cash Balance

The lowest amount of cash that a company or individual seeks to maintain on hand to meet immediate expenses.

Raw Material

Basic materials used in the production process, which are transformed into finished goods.