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Depreciation is regarded as a source of capital because it is a noncash expense on the Income Statement. (see "Understanding Wall Street" 5th ed. by Jefffrey B. Little & Lucien Rhodes - pg 51.)
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How does depreciation affect the cost of capital?
Please refer to the following Web site for a complete explanation on how depreciation affects the cost of capital: http://en.wikipedia.org/wiki/Depreciation
Which of the following provisions of the Internal Revenue Code can be used to reduce the amount of the income tax expense arising from capital investment projects?
Depreciation deduction submitted by Gigi Calix
Is depreciation included as a cash flow in capital budgeting?
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.
What is the Difference between accumulated depreciation and depreciation?
Depreciation expense is a nominal account which will goin to net income at the end of term. Accumulated depreciation is a contra account with capital assets which shows up in balance sheet.
What are the varioius Internal sources of cash?
Depreciation Amortization of intangible assets
Why is depreciation always positive on a cash flow statement?
depreciation is a source of cash. because we charge depreciation in profit and loss but we added back in cash flow. remember one thing that capital expenditure= amount of depreciation
How does depreciation affect the cost of capital?
Please refer to the following Web site for a complete explanation on how depreciation affects the cost of capital: http://en.wikipedia.org/wiki/Depreciation
What is maximise?
Growth depends on the volume of investment. Investment depends on capital availability. Capital may come from either internal or external source. External source of capital is costly where as internal generation of funds is economical. Generation of internal capital depends on profit making capacity of a firm. Hence, profit maximization would automatically lead to growth maximization
What is growth maximisation?
Growth depends on the volume of investment. Investment depends on capital availability. Capital may come from either internal or external source. External source of capital is costly where as internal generation of funds is economical. Generation of internal capital depends on profit making capacity of a firm. Hence, profit maximization would automatically lead to growth maximization
Gradual wear on capital goods?
depreciation
Which of the following provisions of the Internal Revenue Code can be used to reduce the amount of the income tax expense arising from capital investment projects?
Depreciation deduction submitted by Gigi Calix
What is capital depreciation?
When you buy a plant or equipment, it will lose value over time - it's breaking down or it's not as efficient or the such; this gradual decline in worth of the capital is depreciation.
What is depreciation of capital?
When you buy a plant or equipment, it will lose value over time - it's breaking down or it's not as efficient or the such; this gradual decline in worth of the capital is depreciation.
Is depreciation included as a cash flow in capital budgeting?
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.
What are the varioius Internal sources of cash?
Depreciation Amortization of intangible assets
What is the Difference between accumulated depreciation and depreciation?
Depreciation expense is a nominal account which will goin to net income at the end of term. Accumulated depreciation is a contra account with capital assets which shows up in balance sheet.
Can depreciation be charged on capital work in progress. Give reasons?
no depriciation is usually not charged on capital WIP
