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 ...

Posting depreciation means to account for depreciation using the proper journal entries. Companies must depreciate their assets annually. Depreciating assets will match the cost to purchase the asset ...

When a company purchases an asset it does not expect the asset to retain its current value forever. Instead, the company expects the asset to depreciate, or loose some of its value over time.

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 most important accounting formulas are practical and intuitive, making them easy to remember and apply. Many, or all, of the products featured on this page are from our advertising partners who ...