Accounting for IGCSE & O level - Final Statements (Section 6 - No. 25)
How does depreciation affect the net book value of an asset?
It increases the net book value.
It has no effect on the net book value.
It decreases the net book value.
It increases the amount of working capital.
Paliwanag
Depreciation is the process of allocating the cost of an asset over its useful life, which reduces its net book value.