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The balance of accumulated depreciation account represents the?
amount charged to depreciation expense since the acquisition of the plant asset.
What is provision of depreciation?
Provision of depreciation is allowance account in which every year fixed amount is put to charged against actual depreciation so that planned income statement can be prepared and profit remains smooth.
What is lost depreciation tax shield?
Lost depreciation tax means that loss of that tax amount which could be saved if there would be depreciation expenses in profit and loss account which will reduce the profit and hence the tax as well.
The balance in the Accumulated Depreciation account represents the?
amount charged to expense since the acquisition of the plant asset.
How does depreciation reduce a taxes?
Depreciation is charged in profit and loss account as expense and it reduces the amount of net profit so in this way it also reduces the income tax payable.
What is the purpose of depreciation expense and accumulated depreciation?
Depreciation expense reduce the cost of asset through income statement for the useful life of asset and accumulated depreciation account is contra account for asset account in balance sheet to show the total amount of depreciation charged.
The balance of accumulated depreciation account represents the?
amount charged to depreciation expense since the acquisition of the plant asset.
How is the supply of money measured and what factors are taken into account in determining its quantity?
The supply of money is measured by the total amount of currency in circulation, plus deposits in banks. Factors taken into account in determining its quantity include the amount of currency printed by the government, the reserves held by banks, and the level of economic activity affecting the demand for money.
What is provision of depreciation?
Provision of depreciation is allowance account in which every year fixed amount is put to charged against actual depreciation so that planned income statement can be prepared and profit remains smooth.
What is lost depreciation tax shield?
Lost depreciation tax means that loss of that tax amount which could be saved if there would be depreciation expenses in profit and loss account which will reduce the profit and hence the tax as well.
The balance in the Accumulated Depreciation account represents the?
amount charged to expense since the acquisition of the plant asset.
How does depreciation reduce a taxes?
Depreciation is charged in profit and loss account as expense and it reduces the amount of net profit so in this way it also reduces the income tax payable.
What contra account is used when recording and reporting the effects of depreciation and why is it used?
The contra account that is used when recording and reporting the effects of depreciation is called amortization of assets. This account is used to reduce the dollar amount of the asset periodically over time to bring assets to current costs.
Why depreciation is not same amount each year?
why depreciation is not same amount each year?
Accumulated depreciation in Accounting?
Accumulated depreciation is contra account to fixed asset to show how much amount of depreciation is charged till date from date of purchase and it is shown in balance sheet in liabilities side or as a deduction from fixed asset in asset side.
What type of account is the accumulated depreciation account?
It is categorized as a contra account. Essentially, it reduces the amount shown on the balance sheet for Property, Plant & Equipment (PP&E), to account for the depreciation that has accumulated over the years that the company has owned the assets. Generally, most companies show PP&E on their balance sheet as a net amount, meaning: ( Total Book Value of Assets - Accumulated Amortization )
Is depreciation a credit or debit entry?
"Depreciation Expense" is a Debit entry and the counter entry is "accumulated depreciation" on an asset which is a credit entry. Depreciation - DR. Amount X Acc. Depreciation - CR. Amount X
