The book or carrying value of an asset is:
A)its acquisition cost less the accumulated depreciation from the acquisition date to the balance sheet date.
B)its acquisition cost plus accumulated depreciation from the acquisition date to the balance sheet date.
C)the amount that could be obtained for the asset on the balance sheet date if it were sold.
D)the annual cost of carrying the asset in inventory.

Question

Quizplus · Accepted Answer

The book or carrying value of an asset is its acquisition cost less the accumulated depreciation from the acquisition date to the balance sheet date. This reflects the current value of the asset on the company's balance sheet. Option B is incorrect as it adds the accumulated depreciation to the acquisition cost, which overstates the value of the asset. Option C is incorrect as it refers to the fair market value or selling price of the asset, which may not reflect the actual value of the asset to the company. Option D is incorrect as it refers to the cost of carrying the asset in inventory, which is not relevant to determining the asset's value on the balance sheet.

The Book or Carrying Value of an Asset Is