Depreciation expense can be a big portion of a company’s total expense. And since expenses decrease income, it affects the overall value of a company. Understanding what it is and the methods can help ...

Accounting for depreciation can be a helpful accounting trick when businesses make a major purchase. Depreciation has several different meanings, depending on the context in which it’s being used.

Assets like equipment, vehicles and furniture lose value as they age. Parts wear out and pieces break, eventually requiring repair or replacement. Depreciation helps companies account for the ...

The goal of accounting is to produce fair and accurate statements about a company's financial performance and condition. An underlying principle of accounting is to connect the expenses that are ...

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and ...

Depreciation is a concept and a method that recognizes that some business assets become less valuable over time and provides a way to calculate and record the effects of this. Depreciation impacts a ...

When teaching depreciation in Introduction to Accounting, faculty always cover a variety of different depreciation methods, including straight-line depreciation. Next time you teach this topic, build ...

Accelerated depreciation allows businesses to write off the cost of an asset more quickly than the traditional straight-line method. This can provide asset owners with potentially valuable tax ...

Accumulated depreciation is the sum of an asset’s depreciation expense. It’s calculated from the start of its use to a specific date. It’s also a contra-asset account. That means it decreases the ...

Will Kenton is an expert on the economy and investing laws and regulations. He previously held senior editorial roles at Investopedia and Kapitall Wire and holds a MA in Economics from The New School ...

A business wants to deduct expenses against revenues in the most effective fashion possible. But being effective doesn't mean that you always deduct an expense immediately. Depreciation allocates the ...