How to record depreciation in journal entry?
Understand the Problem
The question is asking how to record depreciation in a journal entry, which involves understanding the accounting process and the specific accounts impacted by the depreciation expense.
Answer
Debit Depreciation Expense, Credit Accumulated Depreciation.
The journal entry consists of a debit to Depreciation Expense and a credit to Accumulated Depreciation.
Answer for screen readers
The journal entry consists of a debit to Depreciation Expense and a credit to Accumulated Depreciation.
More Information
Depreciation systematically allocates the cost of a fixed asset over its useful life.
Tips
A common mistake is forgetting to credit the Accumulated Depreciation account, which accumulates the total depreciation over time, reducing the asset's book value.
Sources
- The accounting entry for depreciation - AccountingTools - accountingtools.com
- How to Book a Fixed Asset Depreciation Journal Entry - FloQast - floqast.com
- Depreciation Journal Entry | Step by Step Examples - WallStreetMojo - wallstreetmojo.com
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