units of production method depreciation

Units of production method (Production run method)

Definition of units of production method or Production run method The production run method is also known as units of production method or units of output method. Under this method, the depreciation rate is estimated based on the total estimated output. Then, annual depreciation is calculated to multiply the depreciation rate by units of production …

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double declining balance method depreciation

Double declining balance method | definition and example

Definition of double declining balance method of depreciation The double declining balance method of depreciation also called accelerated depreciation method. In this depreciation method first fall the straight-line depreciation rate is determined, just dividing the original cost by its life. It means the scrap value is ignored while calculating the rate of depreciation. The depreciation …

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reducing balance method depreciation

Reducing balance method or Declining balance method of depreciation

Definition of reducing balance method or Declining balance method of depreciation In this reducing balance method of depreciation, depreciation is charged on the assets based on the reduction value of the assets. A fixed percentage (%) of a depreciation rate is assigned on the reduced value of the assets. The depreciation value/ amount in the …

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straight line depreciation mehtod

Straight line depreciation or Original cost method | definition – example

Definition of straight line depreciation A straight line method of depreciation requires a fixed amount of depreciation to be charged on the assets every year. This method also called original cost method, fixed installment method, equal installment method. The depreciation is calculated on the original cost of the assets. The original cost is the acquisition …

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capital expenditure revenue expenditure

Capital expenditure and Revenue expenditure | differences and definition

Definition and difference between capital expenditure and revenue expenditure A business incurs several expenditures during the year some of them are recurring in nature whereas others are non-recurring in nature. The non-recurring expenditure and recurring expenditure respectively called capital expenditure and revenue expenditure. The capital expenditures treated as asset whereas revenue expenditures immediately treated as …

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