Question

What is the difference between accumulated depreciation and depreciation expense? How are they related?

Short answer

Accumulated depreciation is defined as thetotal depreciation charged on the asset of the company since the asset was purchased and used. The depreciation expense is used to compute the accumulated depreciation.

Step-by-step solution

Difference between the accumulated depreciation and the depreciation expense

Depreciation expense is referred to the depreciation of one period, and accumulated depreciation is referred to the aggregate depreciation of all the periods during which the asset is held by the company.

Relation between the accumulated depreciation and the depreciation

Depreciation is charged to record the usage cost of the asset with the benefit gained from its use.And the accumulated depreciation is the total of all the recorded depreciation charged on the asset on a specific date.