 # Depreciation of fixed assets

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It is recognized that the firm was originally bought except the value of land will be reduced with the passage of time, either as a result of the use or the emergence of another similar origin to more sophisticated, this shortfall of the asset should be evidenced in the Books 10-15 called depreciation expenses.

Depreciation
depreciation or depreciation is known as a process in which the distribution of the cost of the asset to the accounting periods (the productive age) after deduction of \$57,678, from this definition we can conclude that the factors affecting CALCULATES depreciation premium is as follows:

1 The cost of the fixed asset:
it represents the original purchase price plus acquisition costs.
2 The productive life of the asset:
the term is intended to be benefit from the asset, which is measured as the number of years or the number of units or mileage (kilometers or meters) or otherwise.
3 scrap value:
refers to the estimated value of the sale of the asset after the end of the productive life of this original
we have explained that the depreciation is the process of distributing the cost of the asset to the accounting periods, so as to download the income of each period a fraction of the cost of the asset, there are several ways to calculate the value of depreciation.

The fixed installment Method
This method is based on the distribution of the cost of the depreciable fixed asset the time periods (the productive age), so that the values of equal depreciation in each period of productive life if we assume that the procurement process with the beginning of the year, annual depreciation premium is calculated according to this method the following equation :

premium annual depreciation = The depreciable cost of the asset of the
productive age
where: the

cost of the depreciable asset = asset value - the value of the scrap
into the equation :

premium annual depreciation = the value of the asset - the scrap value of the
productive age
example
in 01/01/2015 The established purchase air worth 2000 \$ has been productive old b5years, estimated scrap value b 250 \$, what is required to calculate depreciation for the year 2015, the air-conditioned premium

solution :
Premium The annual depreciation = 2000 - 250 = 350 \$
5
authorized depreciation premium \$350 is pocket money for depreciation, which will be loaded to the financial period of the year 2015 as well as on the financial periods 2016f2017f 2018 and2019 equally.

But if we assume that the treaty has purchased air conditioner in 01/8/2015, the value of the depreciation for the year 2015 will change and will be calculated from the date of purchase until the end of the year 2015, which is equal to 5 months.

In 2015, annual depreciation premium = 2000 - 250 x 5 = 146 \$
5 12
depreciation rate:
if we want to extract the annual depreciation rate in the previous example, (100% / 5years=20%) or (350) 2000-250=20%), and in some states may impose the laws of fixed annual depreciation rates for each category of assets, so that companies adhere to their application at the depreciation of assets, in this case, the pocket money for depreciation is calculated by multiplying the ratio for depreciation and the cost of the depreciable asset as follows:

·The annual depreciation = depreciation rate x the DEPRECIABLE cost of the asset of the
diminishing installment Method
This method assumes that the first years of the use of the asset should

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