Is accumulated depreciation on the balance sheet?
Andrew Campbell
Updated on January 01, 2026
What Is Accumulated Depreciation? The accumulated depreciation account is a contra asset account on a company’s balance sheet, meaning it has a credit balance. It appears on the balance sheet as a reduction from the gross amount of fixed assets reported.
How do you report accumulated depreciation on a balance sheet?
Accumulated depreciation is an asset account with a credit balance known as a long-term contra asset account that is reported on the balance sheet under the heading Property, Plant and Equipment. The amount of a long-term asset’s cost that has been allocated, since the time that the asset was acquired.
Where is accumulated depreciation shown in balance sheet?
Accumulated depreciation is typically shown in the Fixed Assets or Property, Plant & Equipment section of the balance sheet, as it is a contra-asset account of the company’s fixed assets.
How is depreciation recorded in balance sheet?
Accumulated depreciation is the running total of depreciation that has been expensed against the value of an asset. Fixed assets are recorded as a debit on the balance sheet while accumulated depreciation is recorded as a credit–offsetting the asset.
What is accumulated depreciation on a balance sheet?
Accumulated depreciation is the sum of all recorded depreciation on an asset to a specific date. Accumulated depreciation is presented on the balance sheet just below the related capital asset line. The carrying value of an asset is its historical cost minus accumulated depreciation.
Are expenses on the balance sheet?
In short, expenses appear directly in the income statement and indirectly in the balance sheet.
What happens to accumulated depreciation when you sell an asset?
When a company sells or retires an asset, its total accumulated depreciation is reduced by the amount related to the sale of the asset. The total amount of accumulated depreciation associated with the sold or retired asset or group of assets will be reversed.
How do you record the sale of a depreciated asset?
How to record the disposal of assets
- No proceeds, fully depreciated. Debit all accumulated depreciation and credit the fixed asset.
- Loss on sale. Debit cash for the amount received, debit all accumulated depreciation, debit the loss on sale of asset account, and credit the fixed asset.
- Gain on sale.
