Question

After an asset is fully depreciated, the asset:

A. remains on the Balance Sheet at (cost - Accumulated Depreciation).

B. remains on the Balance Sheet at a value of $0.

C. remains on the Balance Sheet at cost.

D. must be removed from the Balance Sheet.

Answer 1

Once fully depreciated, an asset stays on the Balance Sheet at its cost minus accumulated depreciation until it's disposed of or sold.

Step-by-step explanation:

After an asset is fully depreciated, it remains on the Balance Sheet at (cost - Accumulated Depreciation), which means that option A is correct. Even though the asset has been fully depreciated and its depreciable value is now $0, it is still reported on the Balance Sheet at its original cost minus all the accumulated depreciation recorded against it. The value of the asset will remain in this state on the Balance Sheet until the asset is disposed of or sold, at which point it will be removed.