What happens to the accounting equation when the adjustment for depreciation expense for the accounting period is recorded?

Question

Quizplus · Accepted Answer

When the adjustment for depreciation expense is recorded, it reduces the value of the asset (through accumulated depreciation), which decreases the total assets. At the same time, the decrease in net income (due to recording depreciation expense) reduces retained earnings which in turn decreases stockholders' equity. Thus, both assets and stockholders' equity decrease.

What Happens to the Accounting Equation When the Adjustment for Depreciation