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

Assume tc stands for total cost, 1. Fill in the table below.  Assume TC sta...

1. Fill in the table below.  Assume TC stands for Total Cost, TFC as Total Fixed Cost, TVC as Total Variable Cost, ATC as Average Total Cost, AFC as Average Fixed Cost, AVC as Aver

What do the "transfer" items in the notes to the financial, What do the "tr...

What do the "transfer" items in the notes to the financial statements relate to? (in the capital assets section; Plant, property & equipment and Intangible assets

A firm is evaluating two machines, A firm is evaluating two machines. The f...

A firm is evaluating two machines. The first costs $250,000 and will require annual maintenance of $30,000 per year for 10 years. At the end of 10 years, the salvage value will b

State the term- liabilities, State the term- Liabilities Current Liabi...

State the term- Liabilities Current Liability is a debt which is due for payment within one year. Long-term liability is one NOT paid in a year. OWNER'S EQUITY Also

Approving an invoice for payment, What steps would you take before approvin...

What steps would you take before approving an invoice for payment? Ans) Following steps should be taken.. ? Certify the invoice once it is matched for checking any holds..

What do you mean by not-for-profit organizations, Q. What do you mean by No...

Q. What do you mean by Not-for-profit organizations? Not-for-profit organizations such like charities, fraternities, churches, and universities need accountants to record and a

The major difference in the statement of retained earnings, The major diffe...

The major difference in the statement of retained earnings between a service business and a  Merchandising business is  A. that the retained earnings statement of a merchandisi

Difference between consignor and consignee, Consignor is the person who is ...

Consignor is the person who is the holder of the goods and who distribute the goods to the consignee. Consignee is the person who takes the goods and he just possesses the goods

CIS 180, Start in cell E3. Complete the series of substitution values rangi...

Start in cell E3. Complete the series of substitution values ranging from 5 to 15 at increments of 1, vertically down column E.

Prepaid or period expense, Are mailing lists are considered as prepaid or p...

Are mailing lists are considered as prepaid or period expens?

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