When companies invest in assets, they expect those assets to last a certain number of years. Over time, they’re depreciated based on their remaining serviceable life and any potential saleable value ...

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 ...

Every day, business managers make capital budget decisions -- choices about whether to invest in projects such as building a factory, upgrading machinery or investing in research and development. But ...

When a business acquires an asset to be used in its operations, the cost of the asset is generally not expensed all at once. Rather, the cost is depreciated over a period of time that depends on the ...

Steven Nickolas is a writer and has 10+ years of experience working as a consultant to retail and institutional investors. Charlene Rhinehart is a CPA , CFE, chair of an Illinois CPA Society committee ...

Straight line method spreads an asset's cost evenly over its life, aiding in clear financial planning. Using this method simplifies financial statements, making a company's health easier to assess.

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 ...

Depreciation is a fairly simple concept. When a business owner buys a fixed asset, that asset loses its value over time, and so its most current value must be accounted for on the company’s balance ...

Depreciation is an accounting methodology that allocates the cost of an asset over its expected useful life. Learn more about how depreciation works and how it affects company financials. blackred ...

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 ...