What are some types of divestitures?

Q: What are the responsibilities of an originator?

A: The originator's responsibilities are: Originator communicates with all borrowers of mortgage loans…

Q: Provide examples of how finacial statments are useful and or how they are used?

A: Financial statements refer to such statements which report the profitability and the financial…

Q: What can be understood by abnormal return?

A: Note firstly we understand what is meaning of abnormal return. Basic meaning of abnormal return is…

Q: Which decision is called the abandonment decision?

A: Answer: The decisions relating to the company that provides flexibility to discontinue the project…

Q: What is asset

A: Assets are those items that provide value for money and future economic benefit for an organization.…

Q: How does the change in the PBO occur?

A: Projected Benefit Obligation:   It is a pension concept in accounting as it is the present value of…

Q: What are some motives for divestitures?

A: The question is based on the concept of divestiture strategy, which is used by company to overcome…

Q: What is modified breakeven analysis?

A: Break even analysis refers to the financial computation that weights the new business cost, product…

Q: What is an estoppel? Why is it used?

A: Estoppel is the legal principle which is helpful for any future contradiction. It means that…

Q: What are the Differences in Maturities?

A: Maturities in the context of the bond mean that bonds are issued for a specific period of time. It…

Q: What is the closing process?

A: Closing Process: Closing process is a process which consists of journalizes the closing entries of…

Q: Distinguish between cumulative or noncumulative?

A: cumulative and noncumulative preferred is assumed since the key term is not given.

Q: Describe the fundamentals of Replacement-Analysis?

A: Replacement analysis is the process where it is determined whether it would be beneficial to replace…

Q: How do fixed asset systems differ from purchases systems?

A: Definition: Purchase system: The identification and procurement of the inventory needs for the…

Q: When are loss contingencies recorded?

A: Definition:   Contingent liability: This is an uncertain obligation which might be incurred on a…

Q: What is multiple discriminant analysis?

A: Multiple discriminant analysis (MDA) is a statistical method used by many financial planners to…

Q: what is a validity check?

A:

Q: Explain the Redemption process?

A: The question is based on the concept of redemption, which is mainly used for repayment of fixed…

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.