The accumulated depreciation relating to the piece of equipment will be eliminated from the accounts when the company disposes of the asset. The double entry for the sale of a piece of equipment would be-
DR Cash/Bank (with the proceeds)
DR Accumulated depreciation (with the total depreciation held for that asset)
CR Equipment (with the original cost of the equipment)
DR/CR Profit/loss on disposal (with the difference between the proceeds and the NBV of the asset at the time of sale).
You can't "walk away" without losing the equity, if any, in your property. Your credit rating would also be seriously affected.
When a consumer defaults on a car loan their credit becomes negatively affected. Not only that, the previously purchased vehicle will become subject to repossession if the payment is not received.
Depending on the business type, business equipment can be a major part of the budget for a start up business. When drafting a business plan and figuring out what your small business loan amount should be, prepare a detailed budget, including the cost of the business equipment that will be needed to start the business. You should also include any equipment that will be needed in the first year to function adequately. If the equipment will require regular maintenance, include maintenance costs in your budget as well. If there is the potential for the equipment to need replacement, factor in the risk associated with that as well. Your loan amount should cover all of these things, since you don't want to have to go back for more money unless something catastrophic happens. Including business equipment in your business plan and budget can assist with getting your business started on the right foot.
If there are 2 people on the deed of trust and only one on the loan - then the person who has defaulted on the loan will have their credit negatively affected. The one who is only on the deed of trust will lose ownership to the bank or mortgage company, however, their credit will not be affected unless they co-signed or guaranteed the original loan that has defaulted.
If the couple apply for any type of joint financing such as a home morgage it could create difficulties. Other than joint financial transactions the credit of the spouse who was not a party in the BK will not be affected
What happens now can only be affected by what is happening now. The future cannot affect the past.
What happens now can only be affected by what is happening now. The future cannot affect the past.
it depends on who is doing the accounting
inflation happens when money loses its value and it affected the Roman Empire.
The person that had equipment now has cash and the person that had cash now has equipment.
None just you blood is affected by anmia
No reaction
It oxidizes.
They are sold on eBay
It is simmilar to what happens when king kong eats godzillas sh*t that he has laid earlier and then king kong sh*ts godzillas sh*t out, that is what accumulated 02 is like. Im morethan freeman thank you for listening
If that happens, it is very likely that the electric equipment gets damaged.
Depreciation does not generate cash flow. If a million dollar piece of equipment is purchased, an accountant would reflect that the company now owns a million dollar asset. Without depreciation, the company would still show a million dollar asset on the books even though we all know the equipment's value is decreasing. As such, the company's value would be overstated in the books. I found this from Wikipedia, so I believe the above answer should be modified. From Wikipedia - "Depreciation recognized for tax purposes will, however, affect the cash flow of the company, as tax depreciation will reduce taxable profits; there is generally no requirement that treatment of depreciation for tax and accounting purposes be identical. Where depreciation is shown on accounting statements, the figure usually does not relate to depreciation for tax purposes." - The above answer is correct. This is an additional point. Depreciation is a source of funds (not cash). Think about this - When you deduct depreciation from your profits, your net income figure gets reduced and if there is any distribution of cash which is based on net income, the amount of cash that is going out of the business will also be reduced. In that way, the company is able to retain part of its cash within the business that could have gone out, had the depreciation not been done. Additional comment - And even more to add regarding the taxes thing (at least in Canada). Depreciation is not an allowable expense for calculating taxable income. What happens is that you add the depreciation that you expensed back, but then you are allowed to take a deduction for capital cost allowance (at specified rates for the particular class of asset) to calculate taxable income. In the US it is a a legit expense and is typical done with straight line or MACRS. Additional comment - Regarding the first post: depreciation in accounting terms (amortization) is not meant to reflect the value of the asset. Rather, it is the gradual allocation of its cost to expense over its useful life. The fair market value of an asset may increase significantly over its original purchase price while at the same time its book value will decrease yearly due to depreciation. Strictly speaking, depreciation is a non-cash expense (no physical outflow of cash is involved). However, as mentioned above by others, it serves to reduce taxable income, which, in turn, reduces the income tax paid.