Question

Explain the effect of write-down expense of $40 on the reports of the business.

Answer 1

A write-down expense of $40 has a negative effect on the reports of a business. It reduces the value of an asset on the balance sheet and decreases the company's net income for the period.

Step-by-step explanation:

A write-down expense of $40 has a negative effect on the reports of a business. It reduces the value of an asset on the balance sheet and decreases the company's net income for the period. This can indicate a decrease in the value of the asset or a loss incurred by the company.