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.

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 ...

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 ...

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 ...

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 ...

Depreciation spreads the cost of tangible assets over their useful life on income statements. Each year, $1,500 is recorded as a depreciation expense, reducing the asset's book value. Amortization and ...