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 ...

Depreciation spreads the cost of tangible assets over their useful life on income statements. Each year, $1,500 is recorded as a depreciation expense, reducing the asset's book value. Amortization and ...

If you recorded a $1 million expense this month for buying a factory or an office building, it might leave your ledger swimming in red ink. Depreciation lets you expense the purchase price over time ...

When a company acquires assets, those assets usually come at a cost. However, because most assets don't last forever, their cost needs to be proportionately expensed based on the time period during ...

Depreciation recapture taxes gains from selling depreciated property as ordinary income, reclaiming prior tax benefits. If you’re a business owner, you’ve probably bought at least some property to use ...

Learn how carrying value signifies asset value on balance sheets, using formulas and examples to assess depreciation and amortization accurately.