Term
| depreciation matches an asset's expense with the _ it produces |
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Definition
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Term
to do depreciation the asset has to be?
(current/non current) |
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Definition
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Term
| for property to be counted as depreciated it must be- 3 |
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Definition
-used in business
-have life longer than 1 year
-can wear out/lose value |
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Term
| To calculate depreciation what 3 things do you need? |
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Definition
acquisition cost
estimatedd useful life
residual value |
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Term
| what are the two things that determine the length of useful life of an asset |
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Definition
physicla deterioration
obsolescence |
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Term
| what is the non accelerrate method for deprication |
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Definition
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Term
| which method says that depreciation stays constant? |
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Definition
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Term
| what are the accelerated methods? |
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Definition
declining balance method
sum of the years digits methods |
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Term
| whihc method is used for income tax reporting? |
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Definition
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Term
| what method do you use if you use the asset the same amount every year? |
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Definition
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Term
| equation for straight line method |
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Definition
| Aq cost-residual x 1/life years |
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Term
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Definition
| net value for asset in the depreciation schedule |
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Term
| how do you calculate book value |
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Definition
| original cost- accumulated depreciaiton |
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Term
| why are accelerated methods for depreicaiton used in income taxing? |
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Definition
| to decrease that year's taxes |
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Term
| equation for Sum of Years Digits method |
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Definition
| (cost - residual) x (remaining years of useful life/sum of years digits) |
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Term
| which method uses a version of the straight line method? |
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Definition
| double declining balance method |
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Term
| which methods does not use the residual value? -2 |
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Definition
double-declining balance method
MACRS |
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Term
| equation for double declining method |
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Definition
| 2x(straight line rate) x Book Value |
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Term
| if purchase item before Septemebr _ then you count the full month of september in the deprecriation |
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Definition
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Term
| the years for MACRS are longer/shorter than estimated useful life for financial reporting? |
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Definition
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Term
| depreicaiton is a what kind of expense? |
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Definition
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Term
| where do you record for the date the asset what FIRST put to use, not when first bought |
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Definition
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