The goal of accounting is to produce fair and accurate statements about a company's financial performance and condition. An underlying principle of accounting is to connect the expenses that are ...

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and ...

The straight-line method depreciates an asset on the assumption that the asset will lose the same amount of value for the duration of its service life. The straight-line method requires you to ...

Straight line method spreads an asset's cost evenly over its life, aiding in clear financial planning. Using this method simplifies financial statements, making a company's health easier to assess.

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.

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 ...

When a business acquires an asset to be used in its operations, the cost of the asset is generally not expensed all at once. Rather, the cost is depreciated over a period of time that depends on the ...

Over time, the assets a company owns lose value, which is known as depreciation. As the value of these assets declines over time, the depreciated amount is recorded as an expense on the balance sheet.

Depreciation is a calculation used to work out the value of assets over time and use. It's drawn from two essential pieces of information—how much an asset originally cost, and its "useful life." ...

Accelerated depreciation allows businesses to write off the cost of an asset more quickly than the traditional straight-line method. This can provide asset owners with potentially valuable tax ...