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A company can change its method of providing Depreciation,
(a) If it is necessitated by Statue or standard, or
(b) If it would result in more Appropriate preparation or presentation of Financial Statement...
Wiki User
∙ 12y ago
Yes, a company can change the method of providing depreciation. However, any change in depreciation method should be disclosed in the financial statements and should be consistent with the accounting principles and standards. Additionally, the change in method may also require restatement of previous financial statements for comparability purposes.
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What type of depreciation method does the company probably use for income tax purposes?
Straight line method.
What depreciation is used in companies regarding company cars?
Reducing balance method
What type of depreciation system does Boeing company use?
Straight line method
What can be done if depreciation is not a whole number?
Depreciation errors are generally corrected by the filing of an amended tax return or through the request of a change in accounting method. If an impermissible method of depreciation has been reported for at least two consecutive years, then a change in accounting method would be required to correct any errors.
Accelerated depreciation method?
Accelerated depreciation is method in which double rate for depreciation is used as compare to straight line method.
Why depreciation is not shown in balance sheet?
depreciation is an estimation and every company estimate there own method's of depreciation which gives more option for fraud . because depreciation is a non cash expense. which can lead to big fraud.
What impact will different depreciation methods have on a companys bottom line?
Different depreciation methods can impact a company's bottom line by affecting the amount of depreciation expense recognized each period. Straight-line method evenly allocates the cost over the asset's useful life, leading to consistent expenses. Accelerated methods like double declining balance result in higher depreciation expenses in the early years which can lower taxable income and increase cash flow. This can impact financial ratios and net income, ultimately affecting the bottom line.
Distinguish between depreciation policy and the concept of depreciation?
Depreciation policy is management thing that what depreciation method to use and how much depreciation to charge to each asset. Depreciation concepts are concepts which govern the depreciation process which management cannot change they are universal rules to follow depreciation that how straight line depreciation work etc.
Depreciation straight line method?
Straight line depreciation method is that method in which fixed amount of depreciation is charged to all fiscal years in which that asset is used.
Straight line method of depreciation?
Straight line depreciation method is that method in which fixed amount of depreciation is charged to all fiscal years in which that asset is used.
What is MT and MSL in accounting depreciation method?
MT and MSL are two depreciation methods used in accounting. They are based on the linear method of depreciation.
How is the straight line depreciation method different from declining balance method?
The straight-line depreciation method allocates the cost of an asset evenly over its useful life, while the declining balance method applies a fixed depreciation rate to the asset's declining book value each year. Straight-line method results in equal annual depreciation expenses, while declining balance method typically yields higher depreciation expenses in the early years of an asset's life.
