Dwayne saw the subsequent information in an accounting report:
Motor Vehicle - $40,000
Less Accumulated Depreciation Motor Vehicle - 12,000
He believes that this seems that if it was sold on that day, the vehicle should have achieved a price of about $28,000.
Is Dwayne right? Justify your answer by describing what is meant by the term depreciation, the role and process of recognizing depreciation in accounting reports, and by identifying the accounting concepts that give the justification for recognizing depreciation.