Which of the Following Properly Describes Accumulated Depreciation

question 161

Multiple Choice

Which of the following properly describes accumulated depreciation?

• A) Accumulated depreciation is a contra liability account.
• B) Accumulated depreciation is an expense account.
• C) Accumulated depreciation is a contra equity account.
• D) Accumulated depreciation is a contra asset account.

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Definitions:

Residual Income

Profit remaining after all costs and expenses, including capital costs, have been deducted. It's often used to assess the profitability of a department or investment.

Operating Assets

Assets that are used for the day-to-day operations of a business, including both current and non-current assets.

Net Operating Income

The total profit of a company after operating expenses are subtracted, but before deducting interest and taxes.

Return On Investment (ROI)

A metric for assessing how well an investment does by comparing what it returns against what it costs.