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

How would you summarize apple''s cash flow position, How would you summariz...

How would you summarize Apple's cash flow position and what does this statement tell you about where the money is coming from and where it's going? What should Apple do to improv

Business transactions and the accounting equation, Business transactions an...

Business transactions and the accounting equation A transaction is any activity which changes the value of a firm's assets, liabilities or owner's equity. Every transaction

Acc 206 Week Two Assignment, #Please complete the following 7 exercises bel...

#Please complete the following 7 exercises below in either Excel or a word document (but must be single document). You must show your work where appropriate (leaving the calculatio

The following stockholders'' equity accounts arranged, The following stockh...

The following stockholders' equity accounts arranged alphabetically are in the ledger of McGrath Corporation at December 31, 2011. Common Stock ($10 stated value) $1,500,0

Calculate the liability, XYZ Solutions Pvt Ltd purchased a new vehicle for ...

XYZ Solutions Pvt Ltd purchased a new vehicle for their employee Sonia to use for both work and private purposes on 1 November 2010.  The car cost $38,500 and they paid an extra $2

Define workout expenditures, Workout Expenditures Professional fees (le...

Workout Expenditures Professional fees (legal, accounting, appraisal) paid to entities unaffiliated with the investment company's advisor or sponsor in connection with any of t

Explain about prepaid insurance, Q. Explain about Prepaid insurance? Th...

Q. Explain about Prepaid insurance? The two accounts recitations to insurance are Prepaid Insurance (an asset) and Insurance Expense (an expense). Subsequent to posting this en

Prepare a trial balance, Case Study : Briana Hope has had a long-standin...

Case Study : Briana Hope has had a long-standing love affair with technology and an appetite for apps. She believes that business owners that are not taking advantage of apps to

Career as an accounting professor, Do you enjoy college life? Do you enjoy ...

Do you enjoy college life? Do you enjoy teaching others? If therefore you might want to consider a career as a college professor. Even though a position as a college professor may

Ratio analysis and its uses, Ratio Analysis : A 'Ratio' is  clear as an  ar...

Ratio Analysis : A 'Ratio' is  clear as an  arithmetical/quantitative/ numerical relationship between two numbers. Ratio analysis is a extremely significant and age old method of f

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