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11. Which of the following statements about the Accumulated Depreciation account is false?

A. The Accumulated Depreciation account normally has a credit balance and is therefore classified as a liability.

B. The Accumulated Depreciation account is referred to as a contra-asset account.

C. The use of a separate Accumulated Depreciation account preserves information pertaining to the original cost of the related asset.

D. The use of a separate Accumulated Depreciation account reveals the total amount of depreciation previously recorded by accumulating this information in the separate ledger account titled Accumulated Depreciation.



Answer :

GinnyAnswer

Final answer:

The Accumulated Depreciation account is not classified as a liability but as a contra-asset account that reduces the book value of the related asset.


Explanation:

The false statement about the Accumulated Depreciation account is: OA. The Accumulated Depreciation account normally has a credit balance and is therefore classified as a liability. Contrary to statement OA, Accumulated Depreciation is classified as a contra-asset account that shows the total depreciation expense taken on an asset over time. It is not a liability account but serves to reduce the book value of the related asset.


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