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Description: The depreciation schedule for an asset, with a salvage value of $90 at the end of the recovery period, has been computed by several methods. Identify the depreciation method used for each schedule. Year ABCD E$1060.0 $212.0 $424.0 $194.0 $107.01339.2

Business

Accounting

Year A B C D E $1060.0 $212.0 $424.0 $194.0 $107.0 1 339.2 254.4 194 216 3 203.5 152.6 194 324 4 122.1 91.6 194 216 122.1 47.4 194 107 6 61.1 1060 1060 970 970 970

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

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.

Topic Video

Question

The depreciation schedule for an asset, with a salvage value of $90 at the end of the recovery period, has been computed by several methods. Identify the depreciation method used for each schedule.

Year A
B
C
D E
$1060.0 $212.0 $424.0 $194.0 $107.0
1
339.2 254.4 194
216
3
203.5 152.6 194
324
4
122.1 91.6
194
216
122.1 47.4
194
107
6
61.1
1060
1060 970
970
970

Definition Video Definition Accounting method wherein the cost of a tangible asset is spread over the asset's useful life. Depreciation usually denotes how much of the asset's value has been used up and is usually considered an operating expense. Depreciation occurs through normal wear and tear, obsolescence, accidents, etc. Video

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