Explanation Depreciation is a process in which the total cost of a tangible asset is distributed over the expected useful period of time. Depreciation is considered as an expense and is subtracted from the revenue and the respective asset. Depreciation is charged on the assets which have the two features listed below: Assets which are tangible. Assets which are purchased for limited useful period of time. Serial Number Asset Reason a. Prepaid Insurance No, depreciation is not charged as prepaid as it is a current asset and the value remains the same. b. Delivery Truck Yes, depreciation is charged as truck once purchased would be used over a limited useful period of time. c. Land No, depreciation is not charged as land purchased is used for unlimited useful period of time...

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ISBN: 9781260255157

Author: Haddock

Publisher: MCG CUSTOM

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Explain whether the assets given below are deprecated or not.

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Explain whether the assets given below are deprecated or not.

Solution Summary: The author explains that depreciation is an expense and is subtracted from the revenue and the respective asset.

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