1. Appendix Depreciation
Contemporary Business Mathematics With Canadian Applications
Eighth Edition S. A. Hummelbrunner/K. Suzanne Coombs
PowerPoint: D. Johnston
Appendix Depreciation
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Depreciation
Loss in value of asset due to physical deterioration or obsolescence
Can be treated as a business expense and used to reduce taxes
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Residual Value
Value of asset after it is no longer useful.
May be referred to as scrap value, salvage value, or trade-in value.
Used to calculate “wearing value” where the “wearing value” is the total amount of depreciation over the life of the asset.
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4. Depreciation Terminology
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5. Methods of Depreciation
Straight-line
Units- of- Product
Declining Balance
Declining Balance with Constant Percent
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6. Straight-line Depreciation
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Straight Line
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8. Depreciation Schedule Straight Line
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9. Units-of-Product Method
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Units-of-Product
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Declining Balance
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Declining Balance
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Constant Percentage
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Summary
Various methods of depreciation can be used to calculate the loss of value in assets over time.
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