CFA Practice Question

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CFA Practice Question

Accumulated depreciation is the result of ______.

A. an expense being prepaid
B. capitalizing an asset
C. writing off an asset
Correct Answer: B

Capitalizing an asset means writing off the benefit of the asset over its useful life. This in turn creates depreciation expense and accumulated depreciation.

User Contributed Comments 2

User Comment
Davidrh Why is C incorrect?
khalifa92 writing of an asset is decreasing the asset value because of a decrease in current replacement cost
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