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    DEPRECIATIONACCOUNITNG Depreciation Accounitng

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    Eshetie
    Eshetie Mekonene Amare

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    DEPRECIATIONACCOUNITNG Depreciation Accounitng

    Uploaded by

    Eshetie
    13 views8 pages
    Eshetie Mekonene Amare

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    © © All Rights Reserved

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    Eshetie Mekonene Amare

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    13 views8 pages

    DEPRECIATIONACCOUNITNG Depreciation Accounitng

    Uploaded by

    Eshetie
    Eshetie Mekonene Amare

    Copyright:

    © All Rights Reserved
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
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    The Concept Of Depreciation is closely related to

    the concept of Business Income. In the Income


    generating process the long term assets tends to
    consume their economic potential. The Economic
    Potential so consumed represents the expired cost
    of these assets and must be recovered from the
    business. Depreciation may therefore be defined
    as that portion of the cost of assets that is deducted from
    revenue for asset’s services used in the operation of a
    business.
     Wear and Tear
     Exhaustion
     Obsolescence
     Efflux Of Time
     Accidents
     Depletions
    It Implies removal of an available but irreplaceable resource.
     Amortization

    The Process of writing off intangible assets is termed as


    amortization.
     Dilapidations

    The term dilapidations refers to damage done to a building


    or other property during tenancy.
     Ascertainment of True Profits.
     Presentation of True Financial Position.
     To Ascertain the True Cost Of Production.
     To Comply with Legal Requirements.
     Replacement of Assets.
     Original Cost Of The Asset.
     Scrap Value of the Asset.
     Estimated Life of the Asset.
     Straight Line Method
     Written Down Value Method
     Machine Hour Rate Method
     Sum of Years Digits Method
     Depreciation Fund Method
     Annuity Method
     Insurance Policy Method
     Depletion Method
     Provision for Depreciation Account is Maintained.
     Provision for Depreciation Account is not Maintained.
     From the Current Date
     From the Retrospective Effect.

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