A depreciation expense has a direct effect on the profit that appears on a company's income statement. The larger the depreciation expense in a given year, the lower the company's reported net income ...

David Kindness is a Certified Public Accountant (CPA) and an expert in the fields of financial accounting, corporate and individual tax planning and preparation, and investing and retirement planning.

When a company purchases an asset it does not expect the asset to retain its current value forever. Instead, the company expects the asset to depreciate, or loose some of its value over time.

Depreciation reflects asset value loss over time, affecting financial statements. Straight-line method spreads depreciation evenly, while accelerated front-loads expenses. Understanding depreciation ...

Depreciation expense can be a big portion of a company’s total expense. And since expenses decrease income, it affects the overall value of a company. Understanding what it is and the methods can help ...

Amortization and depreciation are non-cash expenses on a company's income statement. Depreciation represents the cost of capital assets on the balance sheet being used over time, and amortization is ...

Accumulated depreciation is the sum of an asset’s depreciation expense. It’s calculated from the start of its use to a specific date. It’s also a contra-asset account. That means it decreases the ...

Learn how group depreciation simplifies asset management by pooling similar assets, its benefits, limitations, and why it's ...

Accounting for depreciation can be a helpful accounting trick when businesses make a major purchase. Depreciation has several different meanings, depending on the context in which it’s being used.