Question

a. What is the classification of the Accumulated Depreciation account? b. Which two accounts are affected by an adjusting entry for depreciation?

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a. The Accumulated Depreciation\textbf{Accumulated Depreciation} account is a contra asset, this means that the balance of the Accumulated Depreciation\textbf{Accumulated Depreciation} reduces the value of its affiliated asset account. Contra asset accounts have a credit normal balance, the opposite of an asset account.

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