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Hannah CampbellEconomic Principles & Concepts Journal Title: DIRTI 5 Due Date: February 24, 2019Date Submitted: February 24, 2019
The DIRTI 5 is what an enterprise or company takes into consideration while having the company. DIRTI 5 stands for Depreciation, Interest, Fixed Repairs, Property Taxes, and Insurance. Depreciation: is the reduction of recorded cost of a fixed asset until the asset has a value of zero. oWhen calculating depreciation, the inputs are required which are useful life, salvage value, and cost of the asset. oThere are also three different methods that are used to calculate depreciation which are the straight-line method, unit of production method, and double-declining balance method. Interest: is a payment made to a lender for money that was borrowed. The amount paid back is