Understanding the different methods of Depreciation
Understanding the different methods of Depreciation
In accountancy, depreciation refers to two aspects of the same concept: first, the actual decrease in value of the fair value of an asset, such as the decrease in value of factory equipment each year as it is used and wears, and second, the allocation in accounting statements of the original cost of the assets to periods in which the assets are used (depreciation with the matching principle).
Depreciation is thus the decrease in the value of assets and the method used to reallocate, or "write down" the cost of a tangible asset (such as equipment) over its useful life span. Businesses depreciate long-term assets for both accounting and tax purposes. The decrease in value of the asset affects the balance sheet of a business or entity, and the method of depreciating the asset, accounting-wise, affects the net income, and thus the income statement that they report. Generally, the cost is allocated as depreciation expense among the periods in which the asset is expected to be used.
(Source: https://en.wikipedia.org/wiki/Depreci...)
Video by; / malathi-narayan-b078921b
In association with https://www.findmydreamcollege.co.in and https://www.evidhya.com
"Everyone must have access to knowledge, from anywhere, at any time, to everything They want to learn. Online courses are not harder or easier than the alternatives. They're just delivered differently. Online courses are designed for students at all learning levels. With eVidhya, you can learn from our tutorials and participate in accredited tests.
“There is no wealth like knowledge, and no poverty like ignorance”, Buddha.
Social;
/ evidhya.x
/ evdhya