Plant and assets are those items which is usable in business for more than one fiscal year to generate revenue for business that's why depreciation is charged to allocate the specific portion of cost related to one fiscal year through income statement.
Depreciation
Depreciation is charged to tangible assets while amortization is used to charge intangible assets.
Cost of depreciation assets and accumulated depreciation is same as accumulated depreciaton calculates how much depreciation is charged till date while remaining is current book value of assets.
If fixed assets are properly maintained, depreciation is unnecessary do you agree.?
depreciation of fixed assets reduces the profit as depreciation is also an expense.
on Fixed Assets
Depreciation of plant and equipment is considered an expense because it represents the allocation of the cost of these assets over their useful lives. As assets are used in the production of goods or services, their value decreases over time due to wear and tear, obsolescence, or usage. Recognizing depreciation as an expense in the income statement helps to reflect the decrease in the value of these assets and ensures a more accurate representation of the company's profitability.
Intangible assets are subject to devaluation not depreciation.
In accountancy depreciation refers to two different aspects: 1. the decrease in value of assets and 2. the allocation of the cost of assets to periods in which the assets are used.
the expired cost of fixed plant assets such as land, building, equipment, furniture and fixtures and automobile etc.., after a year is known as depreciation. it means that if you depreciate the value of any fixed assets you will be able to estimate its life for the future use..it can help you to estimate the total revenue earned by using that assets.
depreciation non current asseate
Land is not subject to depreciation, depletion, or amortization.