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Unformatted text preview: Land has an unlimited life and is the only plant asset not depreciation Depreciation Depreciation is NOT: a process of valuation based on market value decline a method of setting aside cash to replace assets How to Measure Depreciation Three items needed Cost of the plant asset Estimated useful life How long the company expects to use the asset Estimated residual value Expected cash value of asset at the end of its life Can be zero Depreciable Cost = Assets cost Estimated residual value...
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- Spring '08
- Financial Accounting