The correct accounting entry to amortise an intangible asset over its useful life is:

Question

Quizplus · Accepted Answer

Amortisation expense is debited to recognise the expense for the period, and Accumulated amortisation is credited to reflect the portion of the asset that has been used up or consumed over time. Option A is incorrect because it credits the asset account directly which goes against the accounting principle of asset reduction. Option B is incorrect because it debits accumulated amortisation which is a contra asset account and credits amortisation of asset which is not a valid account in the chart of accounts. Option C is incorrect because it credits accumulated depreciation which is related to tangible assets and not intangible assets.

The Correct Accounting Entry to Amortise an Intangible Asset Over