BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -Depreciation expense is the cost of an asset that has been depreciated for a single period, and shows how much of the asset’s value has been used up in that year. Accumulated depreciation is the total amount of depreciation expense that has been allocated for an asset since the asset was put into use.

Detailed explanation-2: -Depreciation expense is the amount that a company’s assets are depreciated for a single period (e.g, quarter or the year), while accumulated depreciation is the total amount of wear to date. Depreciation expense is not an asset and accumulated depreciation is not an expense.

Detailed explanation-3: -Depreciation expense is closed at the end of the accounting period. A depreciation expense is a nominal account and must be closed to retained earnings at the end of the period. Other choices are permanent accounts.

Detailed explanation-4: -Under the units-of-production method, the depreciation expense per unit produced is calculated by dividing the historical value of the asset minus the residual value by its useful life in terms of units (or the total number of products that it is expected to be able to manufacture).

Detailed explanation-5: -Depreciation is not a cash expense as there is no amount of cash outflow in depreciation, it is just a decrease in the value of the asset.