No, depreciation is not a current asset. A current asset is any asset that will provide an economic benefit for or within one year. Depreciation refers to an accounting practice that expenses the cost of an item in regular intervals over its useful life. Since depreciation works to devalue items over periods longer than a year, it is not a current asset.
Is Depreciation a Current Asset? FAQs
No, depreciation is not a current asset.
A current asset is any asset that will provide an economic benefit for or within one year.
Depreciation refers to an accounting practice that expenses the cost of an item at regular intervals over its useful life.
Depreciation is not classified as an asset because it does not represent ownership of any resource that can be converted into cash in the short term. Instead, it is treated as an expense and reduces the value of the asset over time.
Depreciation is recorded as an expense on the income statement and reduces the amount of net income reported. It also has an impact on the balance sheet because it reduces the value of assets, which lowers equity.
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