No depreciation is not included as depreciation is allocation of part of assets cost to income statement while in capital budgeting, full cost of asset is already included so if depreciation will also be included then there would be double counting of same asset.
Net National product
it is increasing the incremental cash flow
Depreciation on Capital Expenditure is nothing but Depreciation on fixed assets. Cash Flow statement shows the Capex incurred during the particular time period,i.e. for Quarter or fiscal year. A CAPEX is an amount spent to acquire or improve a long term asset such as plant,equipment or buildings. Usually the cost is recorded in an account classified as Property,plant and equipment.The cost (Except for the cost of LAND) will then be charged to depreciation expense over the useful life of the asset.
Depreciation is a period cost and not a product cost as depreciation is still charged even if there is no production or sale of goods.
No. Depreciation would be considered an uncontrollable cost because it is fixed
Depreciation is an indirect cost as there is no separate identification in product cost that which cost is depreciation as deprecation is a overhead cost thatâ€™s why it is indirect cost.
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.
Yes you can charge those depreciation cost to cost of sales. You should try to charge the depreciation to the relevant area where feasible.
No, Depreciation is the process of allocation of fixed asset cost for it's useful revenue earning value to each fiscal year's income statement. So it does not affect cash.
yes, depreciation is an implicit cost. but this implicit cost is added to total costs in calculating accounting profits.
The depreciation deduction increases the amount of after tax cash (working capital) available to the business. The additional cash is equal to the amount of tax that would otherwise be payable on the depreciation claimed. This is because depreciation is an "unfunded" expense, but is really a tax deferral which is subject to recapture in the future.
Only depreciation for all those fixed assets which directly involve in manufacturing of production volume is part of direct cost while all other depreciation is not part of direct cost and included in indirect cost classification.
Depreciation is called a notional cost because it cannot be measured in real terms.
There is no affect of depreciation on cash flow that's why in indirect method of cash flow net income is adjusted for depreciation to calculate cash flow from operating activities.
yes..depreciation cost is the variable cost..
Depreciation is a fixed cost because variable cost is that cost which change with the change in the production units but it doesn't put any effect on depreciation as depreciation of the equipment will remain same no matter you produce maximum number of units or produce no unit in fiscal year.
Yes depreciation of delivery truck is period cost because it is not product cost as it is not require to make the units of product.
The distribution function would include depreciation on transportation cost.
Depreciation do not increase or decrease the cash as it is just the presentation of actual cost of assets through income statement actual cash was already reduced when asset was purchased.
Relevant to what? Depreciation is an accounting contrivance to diminish taxable income.