英語(yǔ)翻譯
Accounting for depreciation
Fix assets,with the exception of land,lose their ability,over time,to provide services .thus,the costs of fixed assets such as equipment and buildings should be recorded as an expense is called depreciation.Because land has an unlimited life,it is not depreciated.
The adjusting entry to record depreciation debits depreciation expense and credits a contra asset account allows the original cost to remain unchanged in the fixed asset account.
Depreciation can be caused by physical or functional factors.
1.Physical depreciation factors include wear and tear during use or from exposure to weather.
2.Functional depreciation factors include obsolescence and changes in customer needs that cause the asset to no longer provide services for which it was intended.For example,equipment may become obsolete due to changing technology.
Two common misunderstandings exist about depreciation as used in accounting include.
depreciation,unlike most expenses,does not require an outlay of cash when it is recorded.