# How is Class Life or Useful Life Determined for an Asset? 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 of depreciable asset.

## What is a Fixed Asset?

Fixed Asset is a long-term asset (or non-current asset), one that a business will hold for longer than a year. These are permanent, tangible items the business intends to own long-term (more than a year). Examples of Fixed Assets are Vehicles, Buildings, Equipment. These Fixed Assets may be referred to as Property, Plant, and Equipment assets or PP&E. They are used in normal business operations. Fixed Assets depreciate over time.

The most common classes of fixed assets and the related class life are listed below:

• ## Difference Between Depreciation, Depletion, Amortization

In this article we break down the differences between Depreciation, Amortization, and Depletion, discuss how each one is used, and what the journal entries are to record each. The main

• ## Adjusting Journal Entries | Accounting Student Guide

When all the regular day-to-day transactions of an accounting period are completed, the next step is to check on the balances of certain accounts to see if those balances need

• ## How to Calculate Straight Line Depreciation

Straight-line Depreciation is used to depreciate Fixed Assets in equal amounts over the life of the asset. The basic formula to calculate Straight-line Depreciation is: (Cost – Salvage Value) /

• ## How to Calculate Declining Balance Depreciation

Declining Balance Depreciation is an accelerated cost recovery (expensing) of an asset that expenses higher amounts at the start of an assets life and declining amounts as the class life