Depreciation

Legal Definition and Related Resources of Depreciation

Meaning of Depreciation

diminution in value , particularly the deterioration or the loss or lessening in value arising from age and use of a property . See In Re Davies’ estate , 96 N. Y.S.2d 191, 197 Misc. 827.

Financial Definition of Depreciation

A non-cash expense that provides a source of free cash flow. Amount allocated during the period to amortize the cost of acquiring Long term assets over the useful life of the assets.

International Trade Meaning and Definition of Depreciation

A decrease in a currency value relative to another currency in a floating exchange rate system.

Legal Definition of Depreciation

Normally, charges against earnings to write off the cost, less salvage value, of an asset over its estimated useful life. It is a bookkeeping entry and does not represent any cash outlay nor are any funds earmarked for the purpose.

Related Entries of Depreciation in the Encyclopedia of Law Project

Browse or run a search for Depreciation in the American Encyclopedia of Law, the Asian Encyclopedia of Law, the European Encyclopedia of Law, the UK Encyclopedia of Law or the Latin American and Spanish Encyclopedia of Law.

Depreciation in Historical Law

You might be interested in the historical meaning of this term. Browse or search for Depreciation in Historical Law in the Encyclopedia of Law.

Legal Abbreviations and Acronyms

Search for legal acronyms and/or abbreviations containing Depreciation in the Legal Abbreviations and Acronyms Dictionary.

Related Legal Terms

You might be also interested in these legal terms:

Mentioned in these terms

Book Value, Composite Account Method, , Salvage Value.

See also

The decline in value of an asset caused by wear, tear, and… (Read more)

Depreciation of Currency in the Economic Activity

An introductory concept of Depreciation of Currency may be: a change in the exchange rate that enables a unit of one currency to buy fewer units of foreign currency

Accelerated Depreciation Definition (in the Accounting Vocabulary)

The New York State Society of Certified Public Accountants offers the following definition of Accelerated Depreciation in a way that is easy for anybody to understand: Method that records greater DEPRECIATION than STRAIGHT-LINE DEPRECIATION in the early years and less depreciation than straight-line in the later years of an ASSET’S HOLDING PERIOD.

Accumulated Depreciation Definition (in the Accounting Vocabulary)

The New York State Society of Certified Public Accountants offers the following definition of Accumulated Depreciation in a way that is easy for anybody to understand: Total DEPRECIATION pertaining to an ASSET or group of assets from the time the assets were placed in services until the date of the FINANCIAL STATEMENT or tax return. This total is the CONTRA ACCOUNT to the related asset account.

Depreciation Definition (in the Accounting Vocabulary)

The New York State Society of Certified Public Accountants offers the following definition of Depreciation in a way that is easy for anybody to understand: Expense allowance made for wear and tear on an ASSET over its estimated useful life.

United States Tax Concept of Depreciation

A deduction to reflect the gradual loss of value of business property – such as office equipment, vehicles, buildings, and furniture – as it wears out or becomes obsolete. The tax law assigns a life to various types of property and your basis in such property is deducted over that period of time. The tax law specifies the depreciation term for specific types of assets.

If the expense is assumed to be incurred in equal amounts in each business period over the life of the asset the depreciation method used is straight line (SL). If the expense is assumed to be incurred in decreasing amounts in each business period over the life of the asset the method used is said to be accelerated. Two commonly used variations of the accelerated method of depreciating an asset are the sum-of-years digits (SYD) and the double-declining balance (DDB) methods. Frequently, accelerated depreciation is chosen for a business’ tax expense but straight line is chosen for its financial reporting purposes.

Concept of Depreciation in the context of Real Property

Alternatives definitions of Depreciation: (1) Decrease in value to real property improvements caused by deterioration or obsolescence. (2) A loss in value as an accounting procedure to use as a deduction for income tax purposes. (See specific types of depreciation).

Concept of Depreciation in the context of Real Property

Alternatives definitions of Depreciation: (1) Decrease in value to real property improvements caused by deterioration or obsolescence. (2) A loss in value as an accounting procedure to use as a deduction for income tax purposes. (See specific types of depreciation).

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