Match each accounting transaction or balance related to depreciation on the left with its correct accounting treatment or entry on the right.
- Annual depreciation charge for the financial yearDebit Profit and Loss Account, Credit Provision for Depreciation Account
- Transfer of accumulated depreciation upon sale of a fixed assetDebit Provision for Depreciation Account, Credit Asset Disposal Account
- Presentation of accumulated depreciation at year-endDeducted from non-current asset cost in the Statement of Financial Position
- Purchase of a new non-current asset on creditDebit Asset Account, Credit Payable / Supplier Account
Cevap
Annual depreciation charge matches with 'Debit Profit and Loss Account, Credit Provision for Depreciation Account'; Transfer of accumulated depreciation upon sale matches with 'Debit Provision for Depreciation Account, Credit Asset Disposal Account'; Presentation of accumulated depreciation at year-end matches with 'Deducted from non-current asset cost in the Statement of Financial Position'; Purchase of a new non-current asset matches with 'Debit Asset Account, Credit Payable / Supplier Account'.
Each item correctly matches its double-entry posting rule or financial statement reporting format: annual depreciation expense is debited to Profit & Loss and credited to Provision for Depreciation; asset disposal requires transferring accumulated depreciation to Asset Disposal via debiting Provision for Depreciation; the accumulated provision balance is subtracted from asset cost in the Statement of Financial Position; and asset acquisition increases asset cost by debiting the asset account.
Adım Adım Çözüm
Anahtar Kavram
Accounting Treatment of Depreciation and Provision for Depreciation