Question # 02 On July 1, 2001, Company Ronaldo purchased a building at $1,500,000. Building is depreciated using the straight-line depreciation method. Useful life of the building is 10 years. Salvage value of the building at the end of useful life is estimated as $110,000 what is the amount of depreciation expense for 2001? Depreciation expense each year with entries and also prepare depreciation schedule? The accounting year is from Jan – D
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.
Question # 02
On July 1, 2001, Company Ronaldo purchased a building at $1,500,000.
Building is
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