The Roberto Company purchased a limo for $75,000 on October 10, 2020. The lime has a salvage value of $5,000 and an eight-year useful life. The company uses double-declining balance depreciation Required: Compute depreciation expense for 2020 using the If an amount box does not require an entry, enter "0". If required, round your final answers to two decimal places. a. nearest whole month methods b. nearest whole year methods c. half-year convention methods
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.
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