During 2020, the company erroneously transferred to a multi-year / 5-year depreciation account an expense of € 16,000 Make as many annotations as necessary, and display your calculations.
Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
The company's equity and results (before tax) for the fiscal year 2021 are € 1,200,000 and € 390,000 respectively. How will these two sizes be formed (answer using a table) if there are the following observations of the statutory auditor:
The company had created a provision for staff compensation for the first time with an amount of € 20,800 in 2017 and increased it by € 13,000 in 2020 and by € 3000 in 2021. According to an actuarial study, this provision at the end of the closed financial year 2021 should amount to € 44,800, of which € 33,500 concern the previous years.
The company erroneously never
During 2020, the company erroneously transferred to a multi-year / 5-year depreciation account an expense of € 16,000
Make as many annotations as necessary, and display your calculations. The answer must be in a table format of at least 4 columns
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