accumulated depreciation account type

The accumulated depreciation account is a contra asset account used in accounting to track the total depreciation recorded on a fixed asset over time. It is a negative account that reduces the asset’s original cost on the balance sheet, reflecting the asset's decrease in value due to wear and tear, obsolescence, or usage. While depreciation is recorded as an expense in the income statement, the accumulated depreciation account serves as a cumulative record of all depreciation taken, ensuring accurate financial reporting and asset valuation.