Asked by
Verified
The difference between the balance of a fixed asset account and the balance of its related accumulated depreciation account is termed the book value of the asset.
Fixed Asset Account
An account on the balance sheet representing long-term tangible assets held for business use and not expected to be converted to cash in the near term.
Accumulated Depreciation Account
A balance sheet item representing the cumulative amount of depreciation expense charged against an asset over its useful life.
Book Value
Refers to the net value of an asset as recorded on the balance sheet, calculated as the original cost minus accumulated depreciation and impairment.
- Gain insight into the principle and accounting approach towards depreciation.
Verified Answer
Learning Objectives
- Gain insight into the principle and accounting approach towards depreciation.
Related questions
Depreciation Expense Is an Example of an Accrued Expense
Depreciation Measures the Decline in Market Value of an Asset
Depreciation Expense for a Period Is the Portion of a ...
The Systematic Allocation of Land's Cost to Expense Is Called ...
Depreciation Expense Is Reported on the Balance Sheet as an ...