what is accumulated depreciation account

An accumulated depreciation account is a contra asset account used in accounting to track the total depreciation that has been charged against a fixed asset over its useful life. While the fixed asset itself is listed under assets on the balance sheet, accumulated depreciation reduces the asset's book value to reflect its declining value over time due to wear and tear, obsolescence, or usage. This account does not represent an actual cash expense but rather a bookkeeping entry that helps businesses more accurately represent the net value of their assets.