Which one of the following is the correct classification of the type of account for accumulated depreciation?
Understand the Problem
The question is asking for the correct classification of the type of account related to accumulated depreciation, specifically which category it belongs to among the provided options.
Answer
Negative asset
The final answer is Negative asset
Answer for screen readers
The final answer is Negative asset
More Information
Accumulated depreciation is a contra asset account, meaning it reduces the value of the associated asset on the balance sheet.
Tips
Confusion often arises between asset and contra asset classification; remember that accumulated depreciation specifically offsets the asset.
Sources
- Accumulated Depreciation: Everything You Need to Know - investopedia.com
- What Is Accumulated Depreciation? - Coursera - coursera.org
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