Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 18 - No. 39)
What is the primary effect of recognizing depreciation expense?
Increase net income and increase assets.
Decrease net income and decrease assets.
Decrease net income and increase assets.
Increase net income and decrease assets.
Explanation
Depreciation expense reduces net income, and the accumulated depreciation increases, which reduces the assets' value.
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