Companies can use several different methods to calculate depreciation on Fixed Assets. The method is chosen at the time the asset is purchased and placed in service. The method generally remains the...
Posts by Caroline Grimm
The Matching Principle is part of Generally Accepted Accounting Principles (GAAP). It requires that revenues and their related expenses be recorded in the same accounting period. As an example,...
The Class Life or Useful Life of a fixed asset is the number of years over which an asset can be depreciated. Class life is determined by tax law which defines a specific number of years to each type...
A Depreciation Schedule is a listing of every Fixed Asset a company owns. It includes the following for each asset: Asset Name (2015 Ford F150, Hobart Mixer, Hyster Forklift)Any identifying...
Sum of the Years Digits is an accelerated depreciation method, meaning more depreciation is expensed in the early years of the class life of an asset. To calculate depreciation using this method,...
How to Calculate Units of Activity or Units of Production Depreciation
Units of Activity or Units of Production depreciation method is calculated using units of use for an asset. Those units may be based on mileage, hours, or output specific to that asset. For...
