How Does the Adjustment for Depreciation Differ from Other Deferral

question 24

Multiple Choice

How does the adjustment for depreciation differ from other deferral adjustments?

• A) The depreciation adjustment results in an increase to a long-lived asset account while the other deferral adjustments reduce asset accounts.
• B) The depreciation adjustment uses a contra-asset account rather than reducing the asset accounts directly.
• C) The depreciation adjustment increases a liability account rather than reducing an asset account directly.
• D) The depreciation adjustment is not a deferral adjustment, but rather an accrual adjustment.