Which of the following is a true statement about depreciation expense when recorded?

Which of the following is a true statement about depreciation expense when recorded?

• A. Depreciation expense is normally a debit
• B. Depreciation expense is normally a credit
• C. Depreciation expense is an asset
• D. Depreciation expense is a liability

Answer: (A)

Expenses carry a normal debit balance, and depreciation expense is an expense account. When you record depreciation, you debit the depreciation expense to recognize the period’s expense, and you credit accumulated depreciation, a contra-asset that reduces the asset’s net book value on the balance sheet. This makes the statement true: depreciation expense is normally a debit. It isn’t an asset or a liability, and the credit side goes to accumulated depreciation, not to the expense itself.

Expenses carry a normal debit balance, and depreciation expense is an expense account. When you record depreciation, you debit the depreciation expense to recognize the period’s expense, and you credit accumulated depreciation, a contra-asset that reduces the asset’s net book value on the balance sheet. This makes the statement true: depreciation expense is normally a debit. It isn’t an asset or a liability, and the credit side goes to accumulated depreciation, not to the expense itself.