Enumerate the term - depreciation, Accounting Basics

Assignment Help:

Explain the term- Depreciation

This is a term which is used to describe the expense which results from loss of usefulness of an asset because of age, wear and tear, and obsolescence. This adjustment spreads cost of an asset over its useful life. Calculate annual amount, then monthly. Depreciation is ALWAYS recorded by debiting an expense account named Depreciation Expense and crediting an account called a "Contra Account" (means offsetting or opposite). Balance of this contra-asset account is a credit-opposite of an asset account. Amount isn't displayed as a credit to asset account, however in a separate contra-asset account. There would be an individual account for every of the items which are being depreciated. Some illustrations would be: office equipment, store equipment, delivery truck, automobile, etc. Land is never depreciated as it's considered permanent and is presumed to last forever. Depreciation only refers to allocation of an asset's cost over its estimated useful life. There are numerous ways to conclude depreciation however this class will only use one-the Straight-Line Method.

 


Related Discussions:- Enumerate the term - depreciation

Effect of transction, example of increase asset, decrease owner equity

example of increase asset, decrease owner equity

Benefites of management accounting information, Benefites of Management acc...

Benefites of Management accounting information To obtain this benefit, businesses have become more 'customer driven' (which is, concerned with satisfying customer needs). This

Can a buyer still avail the 2% discount if he/she partially, can a buyer st...

can a buyer still avail the 2% discount if he/she partially paid the accounts receivable at the 5th day and the full payment is on the 10th day of the given discount period in th

Describe the methods of recording, Q. Describe the methods of recording? ...

Q. Describe the methods of recording? Two general deductions from gross sales are (a) sales discounts and (b) sales returns and allowances. Sellers trace these deductions in co

Hi, 1. Carmen Santiago works for a number of businesses as a  “consultant...

1. Carmen Santiago works for a number of businesses as a  “consultant.” She has helped design accounting systems,  provided accounting services, and analyzed the financial  s

Principles of Taxation for Business and Investment Planning, Compare and co...

Compare and contrast AICPA SSTS to Circular 230 related to knowledge of client''s omission.

Example of sales cycle of company, Q. Example of sales cycle of company? ...

Q. Example of sales cycle of company? For several retailers a large percentage of their annual sales occur during the period from Thanksgiving to Christmas. They efforts to sto

Direct materials, You have been assigned to analyze the costs of NC Microel...

You have been assigned to analyze the costs of NC Microelectronics, a microchip manufacturer. Indicate whether the following costs are more likely fixed (F), variable (V), or mixed

International recommendations on how IAS 40 can be improved, I need an expe...

I need an experts advice, I''m nearly finished with my Dissertation on IAS 40 - but I need some more guidance on issues with the standard and how it can be improved

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd