As expenses in the profit and loss account = according to straight line or reducing balance methods
and new year - old year and subtracted from the b/s from the fixed asset****
You need to reverse the entries for excess depreciation - Debit Accumulated Dereciation and Credit Depreciation Expense
Which accounting principle directs the depreciation process?
In accounting, depreciation is an allocation of a previous expenditure, while in economics depreciation represents a decline in current value.
MT and MSL are two depreciation methods used in accounting. They are based on the linear method of depreciation.
Relevant to what? Depreciation is an accounting contrivance to diminish taxable income.
Tax department has developed theire own depreciation schedules for different assets class and use their own depreciations rather than using accounting depreciation and due to this accounting depreciation difference there is also difference in tax we pay and tax we calculate and called "Deffered Taxation"
why depreciation run is done in asset accounting in sap fico
Debit Depreciation Expense Credit Accumulated Depreciation
based on accounting flows, depreciation is regarded as fixed cost; based on cash flows, depreciation is not included in fixed cost. so, break-even point by accounting flows is larger than cash break-even point. in the long term, depreciation should be counted. so, break-even by accounting flows is longer term in nature.
The depreciation rate for accounting may be different than that of taxation. The depreciation as per books of accounts may often be termed as book depreciation while that calculated under tax law is termed as tax depreciation.
yes, depreciation is an implicit cost. but this implicit cost is added to total costs in calculating accounting profits.
Prospectively, like changes in accounting estimates