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    NEBRASKAFOREVER's Avatar
    NEBRASKAFOREVER Posts: 1, Reputation: 1
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    #1

    Sep 15, 2008, 09:19 PM
    Adjusting entry for depreciation expense
    What is the effect of the adjusting entry for depreciation expense?
    blue but girl's Avatar
    blue but girl Posts: 3, Reputation: 2
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    #2

    Feb 21, 2010, 10:09 AM

    Does the recording of an adjusting entry for depreciation have the same effect as recording an adjusting entry for an accured expense?
    antigua's Avatar
    antigua Posts: 2, Reputation: 1
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    #3

    Jul 22, 2011, 09:29 PM
    An accrued expense
    antigua's Avatar
    antigua Posts: 2, Reputation: 1
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    #4

    Jul 22, 2011, 09:31 PM
    A prepaid expense
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #5

    Jul 23, 2011, 06:32 AM

    A prepaid expense is an asset because you have not incurred the expense yet.

    For example when you purchase insurance you record the purchase as a prepaid expense because you have not used the insurance yet. You have purchased the insurance to be used later.

    As you use the insurance you will have to transfer a portion that is in prepaid expense to your expense account.
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