Depreciation Assignment Help

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The accounting method of assigning the cost of a substantial asset over its useful life is known as Depreciation. For tax and accounting processes, business depreciates long-term assets. The cost of the tangible assets which the businesses purchase as business expenses are deducted by the businesses for tax purpose. In case of tax purposes, it affects the balance sheet of business or entity. In case of accounting purposes, it affects the net income which they report. Depreciation doesn’t really involve cash and therefore depreciation is a difficult concept for the students of accounting.Depreciation is considered as a non-cash transaction which is an accounting convention that allows a company to write-off the value of asset overtime. Though Depreciation expense doesn’t involve the representation of cash transaction, yet it gives the indication of the amount of asset’s value that has been used up overtime. Depreciation is also used to indicate the market value loss. Generally, when the assets are placed in service, then the depreciation expenses begin. There may be variations in the methods of computing depreciation and the period over which the assets are depreciated within the same business or for the tax purposes.

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Various Methods of Depreciation


Calculation of Depreciation involves various methods depending on either the passage of time or level of use of asset which is explained by Depreciation Assignment Help.

1. Double Declining Balance Method: – The recover value is not considered in determining the yearly depreciation, while using the Double Declining Depreciation Method. The book value of the asset which is being depreciated is never brought below its recovering value, no matter which method is being used. This is explained by Depreciation Assignment Help.

2. Straight Line Depreciation Method: – Out of the various methods used for calculating Depreciation, Straight Line Depreciation Method is the simplest method which is mostly used. At the end of the period, the company estimates the residual or scrap value of the asset.
3. Units of Time Depreciation: – Units of Time Depreciation is explained by Depreciation Assignment Help. It is a method which is used for depreciation apparatus in mining or natural resources investigation. It is also used in cases where the amount the asset is used is not linear annually. Units of Depreciation are somewhere similar to the unit of production method.

4. Annuity Depreciation: – The Annuity Depreciation Method estimates the depreciation expenses every year by multiplying the number of miles driven by the per mile depreciation rate. It is based on level of annuity and not on time.

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