What is the purpose of end year period adjustments? Give specific When the value of assets decline, its usefulness or useful life declines. Many companies buy assets during the year or at year end. During a specified accounting period, organizations must reflect these purchases and account for depreciation for reporting purposes. For this reason a contra account is created called "Accumulated Depreciation."
Please explain this process by giving a specific example. What financial statements do these accounts reflect in and what accounts are impacted by these transactions?