When a business buys a long-term asset, it records a portion of the asset's cost as a depreciation expense on the income statement each period to account for wear and tear. With the ...

In modern industry, where machinery often represents the largest share of capital investment, understanding the real economic ...

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 is the recovery of the cost of a physical asset, like property or equipment, over multiple years. It allows companies to spread out the cost of some expenses, reduce taxable income and ...

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.