A new accountant working for Malawi Limited records $800 depreciation expense on store equipment at year end as follows: The effect of this entry is to

Question

A new accountant working for Malawi Limited records $800 depreciation expense on store equipment at year end as follows:  The effect of this entry is to

Quizplus · Accepted Answer

Recording $800 depreciation expense on store equipment at year end overstates the carrying amount of the depreciable assets at year-end. This is because the depreciation expense reduces the value of the assets, and if not recorded properly, it could affect the accuracy of the financial statements.

A New Accountant Working for Malawi Limited Records $800 Depreciation