Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 14 - No. 38)
What effect does depreciation have on a company's balance sheet?
Increases assets.
Decreases liabilities.
Decreases the book value of the asset.
Increases equity.
Explanation
Depreciation reduces the carrying value of an asset on the balance sheet by allocating its cost over its useful life.
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