1.
Depreciation is a
for the business.
2.
Depreciation is regarded as a part of the
of goods.
3.
Depreciation is charged on
.
4.
Depreciation is not charged in the case of
.
5.
Depreciation is charged against the
of an accounting period.
6.
Depreciation does not depend on fluctuations in the
value of assets.
7.
A
in the value of an asset is known as depreciation.
8.
The main aim of providing depreciation is to calculate
.
9.
Losses on the sale of machinery are credited to the
.
10.
The amount of depreciation charged on machinery is debited to the
.
Depreciation is the process of allocating the cost of an asset over its useful life. The objective of Depreciation accounting is to match the expense of using an asset against its revenue. There are many different ways to calculate Depreciation, but the most common approach is the straight-line Depreciation method. Under this approach, the cost of an asset is divided by its estimated useful life to come up with a Depreciation expense per year. Depreciation is used for tangible assets such as property, plant, and equipment, while amortization is used for intangible assets such as patents and copyrights. Amortization is also used to allocate the cost of a bond's premium or discount over the bond's life. Yes, the IRS has several special Depreciation rules for businesses. These include bonus Depreciation, which allows businesses to take a larger deduction in the year an asset is placed into service, and Section 179 Depreciation, which allows businesses to deduct the total cost of certain types of assets in the year they are purchased. The most common Depreciation methods are the straight-line Depreciation method, the accelerated Depreciation method, and the declining balance Depreciation method. True Tamplin is a published author, public speaker, CEO of UpDigital, and founder of Finance Strategists. True is a Certified Educator in Personal Finance (CEPF®), author of The Handy Financial Ratios Guide, a member of the Society for Advancing Business Editing and Writing, contributes to his financial education site, Finance Strategists, and has spoken to various financial communities such as the CFA Institute, as well as university students like his Alma mater, Biola University, where he received a bachelor of science in business and data analytics. To learn more about True, visit his personal website or view his author profiles on Amazon, Nasdaq and Forbes.
Depreciation: Fill In the Blanks FAQs
Depreciation: Fill In the Blanks
