Accounting for IGCSE & O level - Final Statements (Section 13 - No. 24)
What is the impact of depreciation on the statement of financial position?
Increases the value of an asset.
Decreases the value of an asset.
Increases the company's liabilities.
Has no effect on the balance sheet.
Explanation
Depreciation reduces the carrying value (book value) of an asset on the balance sheet.