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Name: Please solve and find Solvency ratio: Net Income-$54,711Depreciation-
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Description: Please solve and find Solvency ratio: Net Income-$54,711Depreciation- 18, 752Short Term Liabilities-$105,392Long Term Liabilities- $258,549

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Please solve and find Solvency ratio: Net Income-$54,711 Depreciation- 18, 752 Short Term Liabilities-$105,392 Long Term Liabilities- $258,549

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Depreciation Methods

The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.

Depreciation Accounting

In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.

Topic Video

Question

Please solve and find Solvency ratio:

Net Income-$54,711

Depreciation- 18, 752

Short Term Liabilities-$105,392

Long Term Liabilities- $258,549

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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