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 ...

Depreciation is an accounting tool used to spread the cost of valuable assets over a number of accounting periods. Rather than incurring the entire expense in a single period, business owners can ...

Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. Khadija Khartit is a strategy, investment, ...

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 ...

When companies invest in assets, they expect those assets to last a certain number of years. Over time, they’re depreciated based on their remaining serviceable life and any potential saleable value ...

Assets like equipment, vehicles and furniture lose value as they age. Parts wear out and pieces break, eventually requiring repair or replacement. Depreciation helps companies account for 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 fairly simple concept. When a business owner buys a fixed asset, that asset loses its value over time, and so its most current value must be accounted for on the company’s balance ...

Depreciation recapture taxes gains from selling depreciated property as ordinary income, reclaiming prior tax benefits. If you’re a business owner, you’ve probably bought at least some property to use ...