Accumulated Depreciation is a permanent account. True False

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Accumulated Depreciation is a permanent account.

True

False

Ledgers and Accounts:

An accounting system consists of many accounts and sub accounts which could be permanent or temporary in nature. A synonym for a permanent account is a real account.

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Ledgers & Charts of Accounts | Definition, Types & Relationship

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Chapter 3 / Lesson 5

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Discover the chart of accounts and ledger accounting definitions. Learn about the different ledgers and account types, as well as the chart of accounts numbering system.

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True or False: Accumulated Depreciation is a permanent account.
Accumulated Depreciation is classified as an expense. a. True b. False
The Retained Earnings account is a temporary account. a. True b. False
True or False: The accumulated depreciation account is closed to the income summary account.
The accumulated depreciation account is a contra-asset account that shows the amount of depreciation for the current year only. a. True b. False
The account, accumulated depreciation, is reported on the income statement as an expense. a. True b. False
Accounts receivable is a permanent account. a. True b. False
Accumulated depreciation is an expense account that appears in the income statement. True or False?
True or false? Permanent accounts start each accounting period with a zero balance.
True or false? The balance in accumulated depreciation decreases each year by the amount of depreciation taken.
The depreciation account appears in the trial balance and is taken only to the profit and loss account. a. True b. False
Answer true or false: The normal balance of the accumulated depreciation account is a debit.
The Accumulated Depreciation account is deducted from the cost of fixed assets on the balance sheet. a. True. b. False.
Depreciation is charged on all assets. a. True b. False
All permanent accounts must be closed at the end of the accounting period. a. True. b. False.
The Service Revenue account is a permanent account. a. True b. False
Assets, liabilities, and the owner's capital account are permanent accounts. a) True b) False
Temporary accounts must be closed at the end of the accounting year. a. True b. False
Assets and liabilities accounts are considered permanent accounts. a. True. b. False.
True or false: The balances of the Depreciation Expense and the Accumulated Depreciation accounts should always be the same.
The account, "Allowance for Uncollectible Accounts", is a contra-asset account. a. True b. False
True or False: Accumulated Depreciation is reported as a liability on the balance sheet.
Revenue is a temporary account. True False
An account that is kept open from one accounting period to another is a nominal account. True False
Depreciation expense is a non-cash item on the balance sheet. (a) True (b) False.
Closing entries deal primarily with the balances of permanent accounts. a. True b. False
The balance sheet accounts are referred to as real or permanent accounts. True False
After closing entries have been journalized and posted, all permanent accounts in the ledger should have zero balance. True False
A contra asset account is subtracted from a related account in the balance sheet. a. True b. False
Depreciation is a credit transaction. True False
Residual value is ignored under declining balance depreciation except for the final year. True or False?
True or false: Accumulated Depreciation is a liability account and has a credit normal account balance.
The adjusting entry for depreciation is a debit to an expense account and a credit to an asset account. a. True b. False
Under the direct method, depreciation is the first noncash account balance analyzed. Is the statement true or false?
True or false? A permanent account is another name for a nominal account.
Book value is depreciable cost minus accumulated depreciation. True or False?
The account Unearned Revenue is generally considered to be a current liability account. True False
Allowance for Doubtful Accounts is a contra-equity account. a. True. b. False.
On the balance sheet, it is not necessary to report both the cost and the accumulated depreciation of an asset. a. True b. False
The purpose of depreciation is to have the balance sheet report the current value of an asset. True False
Depreciation Expense will not appear on the post-closing trial balance. (True/False)
Unearned Revenue account is a liability account. a. True b. False
Determine whether the following statement is true or false: Accumulated depreciation is an example of an expense account.
Depreciation is an expense that reflects the cost of uncollectible receivables. A) True. B) False.
Depreciation is the an expense against the wear and tear of an asset. True or false?
Depreciation is the allocation of an asset's cost over its useful life. True or False
Temporary accounts are reduced to zero at the end of each fiscal period. True or false?
True or false? Temporary accounts carry a zero balance at the beginning of each accounting period.
Depreciation Expense is sometimes referred to as a non-cash expense. True False
When an asset is disposed of, the current period's depreciation expense account must be updated to the time of the disposal. a. True. b. False.
True or false? Income statement accounts are temporary accounts, while balance sheet accounts are permanent accounts.
The income summary account is a temporary account that does not have a normal balance true or false?
A debit balance in retained earnings is referred to as an accumulated deficit. True or false?
True or false? If depreciation expense is calculated without taking into account the asset's residual value, depreciation expense will be higher than it should have been.
The declining-balance method is an accelerated depreciation method. True or False?
Depreciation expense is recorded for a specific period of time. a. True b. False
Depreciation Expense can be ignored when computing the accounting rate of return. True False
Answer true or false: Assets, liabilities, and equity accounts are not closed; these accounts are called Temporary Accounts.
True or False: The dividends account is a temporary account.
Failure to record depreciation expense at year's end will overstate the asset's book value. a. True b. False
True or false? The balance in the accumulated depreciation account will be the same at the end of an asset's useful life under all the methods allowed under GAAP.
True or false? If a company uses the contra account Accumulated Amortization, this account will typically be shown on the balance sheet.
Accounts Payable can be a current asset in the long run. a. True. b. False.
Depreciation refers to the periodic allocation of the cost of a tangible long- lived asset over its estimated useful life. Indicate whether the statement is true or false.
Sales Returns and Allowances is a contra-asset account. a. True b. False
Unearned Revenue is an asset account and should therefore have a normal debit balance. (True/False)
Temporary accounts with zero balances are listed on the post-closing trial balance. True or false?
The Income Summary account is closed to Retained Earnings. (True/False)
Revenues and expenses are temporary accounts and are closed at the end of the accounting period. a) True b) False
All recorded intangible assets are subject to amortization. a. True b. False
The allowance for bad debts is a contra asset account to accounts receivable. Is the statement true or false?
The income summary account is closed to the owner's capital account. True False
Revenue and expense accounts plus the income summary and dividend accounts are often called permanent accounts. True False
True or False: The book value of an asset is its original cost minus accumulated depreciation.
Depreciation Expense shown on the financial statements is a precise amount that is continuously refined. True False
True or False: The amount of depreciation added to net income equals the sum of the debits to the Accumulated Depreciation account.
The accounting equation can be restated as: Assets - Equity = Liabilities. a. True b. False
Answer true or false: The Income Summary account is a permanent account that will be carried forward period after period.
Answer true or false: The closing process brings nominal (temporary) accounts to a zero balance.
An asset account is increased with a debit. a. True. b. False.
All intangible assets must be amortized each year. a. True. b. False.
The sales discount account is a contra-account to Accounts Receivables. True False
Depreciation is the portion of the cost of an asset that is charged as an expense at the end of the accounting period. True or false?
As the equipment is depreciated, its accumulated depreciation decreases and its book value increases. a. True b. False
True or false? Cash Short and Over is a temporary equity account.
The Allowance for Doubtful Accounts is a contra asset account that reduces the value of accounts receivable reported on the balance sheet. a. True b. False
If the asset is discarded or retired, a loss will occur regardless of the book value of the asset. a. True b. False
Prepaid expense and unearned income accounts are assets. A) True B) False
Total asset cost plus depreciation expense equals book value. True or false?
True or False: Accumulated depreciation is a contra-asset account that decreases the historical cost of a fixed asset to determine its book value.
True or False: Goodwill is an intangible asset that is amortized over its life.
True or False: All intangibles are amortized over a period, not to exceed 40 year.
During the closing process, all asset and liability accounts are returned to a $ balance. (True/False)
The balance of the allowance for doubtful accounts is deducted from accounts receivable on the balance sheet. a. True. b. False.
The Sales Returns and Allowances account is an expense account. A. True B. False
True or false: Real (permanent) accounts are revenue, expense, and dividend accounts and are periodically closed.
Book value is equal to the original cost of the asset less the total balance in accumulated depreciation. (a) True (b) False.
Accrued revenue is unearned. (a) True (b) False.
Depreciation is based upon cost, useful life, and salvage value. (a) True (b) False.
Prepaid expenses and unearned income accounts are assets. Is the statement true or false?

Accumulated Depreciation is a permanent account. True False

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