What is recoverable depreciation?

Explain the difference between accumulated depreciation and depreciation expense.What is the purpose of each.?

• Along the same lines, the cost principle requires an asset to be initially recorded at cost. Depreciation causes the asset's book value to decrease over the life of the asset. Explain the difference between accumulated depreciation and depreciation expense. What is the purpose of each account?

• Answer:

  Accumulated depreciation is the depreciation expense so far for a given asset. This goes on the balance sheet as a contra account (negative) which reduces the net value of the asset. In theory the asset get less valuable as time passes. The expense is the amount taken this accounting period. This is on the Income statement.