Which of the following Explanation: s most likely would satisfy an auditor who questions management about significant debits to the accumulated depreciation accounts?

Question

Quizplus · Accepted Answer

Choice "B," is correct. A, debit to accumulated depreciation decreases the balance in that account. T,he retirement of plant assets necessitates the removal (decrease) of accumulated depreciation related to the retired asset by debiting accumulated depreciation. C,hoice "A," is incorrect. R,emember that correction of an estimate is given prospective, not retroactive, treatment. T,herefore, there would not be any decrease in the accumulated depreciation taken in previous years, although future credits would be lower than previous credits had been. C,hoice "C," is incorrect. I,f the prior year's depreciation expense were understated (i.e., too low), the entry to correct the error would be a credit to accumulated depreciation. C,hoice "D," is incorrect. R,evision of overhead allocations would not result in a debit to accumulated depreciation.

Which of the Following Explanation: S Most Likely Would Satisfy