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-   -   Depreciation (https://www.askmehelpdesk.com/showthread.php?t=656089)

  • Apr 30, 2012, 09:14 PM
    saba999
    Depreciation
    On July 1, 2001, a machine is purchased at a cost of $ 20,000.Before the 2001 books are closed you discover that an error caused by using an in correct residual value resulted in depreciation for the year being $200 too high.To correct this error you will record a second adjusting entry for depreciation that will include

    a. a $200 debit to Depreciation expense
    b. a $200 credit to Asset-Machinery
    c. a $200 debit to Accumulated Depreciation
    d. none of above
  • Apr 30, 2012, 09:16 PM
    paraclete
    Quote:
    Originally Posted by saba999 View Post
    On July 1, 2001, a machine is purchased at a cost of $ 20,000.Before the 2001 books are closed you discover that an error caused by using an in correct residual value resulted in depreciation for the year being $200 too high.To correct this error you will record a second adjusting entry for depreciation that will include

    a. a $200 debit to Depreciation expense
    b. a $200 credit to Asset-Machinery
    c. a $200 debit to Accumulated Depreciation
    d. none of above
    c.
  • May 1, 2012, 01:31 PM
    saba999
    Quote:
    Originally Posted by paraclete View Post
    c.
    Can you please explain, why Accumulated depreciation should be debit and C option is correct?

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