Chapter 8 - Long term assets Depreciation Depletion...

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Long term assets Depreciation Depletion Ammernization Regardless of the type of asset it must have a historical cost. Tax will be figured into the total cost and depreciation will be figured from that amount. "Basket" land and building at one time, real estate. Land never depreciates. Buildings, however, do so you separate and then depreciate the building. Example Appraised value on land 100000 Land 25000 Building 75000 Sale Price 110000 Land 27500 Building 82500 Straight line depreciation Units of Production Declining Balance Straight line depreciation Equipment 85000 Life is four years Salvage (residual) value 5000 Debit Credit depreciation expense 20000 accum depreciation 20000
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*you can always revise your estimates for the remainder of the time period. you do not need to go back and change the previous years. the end difference between the equipment account and the account depreciation still needs to be the residual value. Double Declining Balance
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This note was uploaded on 06/08/2008 for the course BA 213 taught by Professor Krislen-adams during the Spring '08 term at Linn Benton Community College.

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Chapter 8 - Long term assets Depreciation Depletion...

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