Answered: Identify and define the three…

Identify and define the three characteristics of an asset that must be established to determine periodic depreciation, depletion, or amortization.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 9Q: Explain the difference between depreciation, depletion, and amortization.

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Question

Identify and define the three characteristics of an asset that must be established to determine periodic depreciation, depletion, or amortization.

Definition Video Definition Accounting method wherein the cost of a tangible asset is spread over the asset's useful life. Depreciation usually denotes how much of the asset's value has been used up and is usually considered an operating expense. Depreciation occurs through normal wear and tear, obsolescence, accidents, etc. Video

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Section 179 Deduction and Modified Accelerated Cost Recovery System (MACRS) Depreciation

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