Question

Machinery and equipment depreciation expense for general capital assets totaled $163,000 for the reporting period. Which of the following correctly defines the recording of depreciation for general capital assets?

a. Debit: Depreciation Expense $163,000; Credit: Accumulated Depreciation $163,000

b. Debit: General Capital Assets $163,000; Credit: Depreciation Expense $163,000

c. Debit: Accumulated Depreciation $163,000; Credit: Depreciation Expense $163,000

d. Debit: General Capital Assets $163,000; Credit: Cash $163,000

Answer 1

The correct way to record depreciation for machinery and equipment totaling $163,000 is to debit Depreciation Expense and credit Accumulated Depreciation for the same amount.

Step-by-step explanation:

The correct recording of depreciation for general capital assets should reflect the reduction in value of these assets over time due to wear and tear, aging, or obsolescence. The journal entry to record depreciation would be a debit to Depreciation Expense and a credit to Accumulated Depreciation. Therefore, the correct answer to how you would record machinery and equipment depreciation expense totaling $163,000 for the period is: a. Debit: Depreciation Expense $163,000; Credit: Accumulated Depreciation $163,000. This entry increases the expense for the period and builds up the accumulated depreciation on the balance sheet, which is contra to the assets account. This entry does not involve the General Capital Assets account directly nor does it involve cash since depreciation is a non-cash expense.