- Depreciation is an allocation of capital expenditures over the estimated revenue producing period of a long term asset. This is required due to the matching principle.
- Depreciation is a determined by acquisition cost, useful life, depreciation rate, and estimated salvage value.
- Depreciation does not involve the cash account Only the purchase and disposal of assets involve cash account
Accumulated Depreciation Balance Sheet
How to Calculate Net Income
Accounting Financial Statements
Credit Sales and Purchases Accounting Problems
Straight Link Depreciation Example
Depreciation of an Asset and Book Value