Question: What is the correct entry to record a machine that was fully depreciated by $25, 000 and discarded because it was worthless?

Select one:

a.

Debit machine $25 000; credit accumulated depreciation $25 000

b.

Debit depreciation expense $25 000; credit accumulated depreciation $25 000

c.

Debit machine $25 000; credit bank $25 000

d.

Debit accumulated depreciation $25 000; credit machine $25 000

Question:

Which statement best describes the nature of depreciation?

Select one:

a.

A charge against profits to provide funds for asset replacement.

b.

Allocating the cost of an asset over its useful life.

c.

Writing down the value of an asset according to the decline in its physical efficiency.

d.

Writing down the value of an asset according to the change in its market value.