QuickBooks ProAdvisor Practice Exam

The process of recording depreciation in QuickBooks typically involves making journal entries. When a business purchases a fixed asset, such as equipment, it needs to account for the reduction in value of that asset over time due to wear and tear, obsolescence, or other factors. This is done by allocating a portion of the asset's cost as an expense over its useful life.

In QuickBooks, the entry for depreciation usually consists of debiting the depreciation expense account and crediting the accumulated depreciation account. This approach not only maintains accurate financial records but also ensures that the expense is recognized in the period it applies to, aligning with the matching principle in accounting.

The other options are not directly related to the specific process of recording depreciation. Generating financial statements is a broader task that reflects the company's financial health but does not involve the specific action of recording depreciation. Entering expenses pertains to recording various business costs, while adjusting inventory levels relates to managing stock, neither of which directly involves the process of depreciation accounting.