Depreciation is the systematic and rational allocation of tangible asset cost over the periods benefited by the use of the asset (Smith, Stice, Skousen & Skousen, 1998). The objective of depreciation is to have each period benefiting from the use of the asset bear an equitable share of the asset cost. There are a number of methods for allocating the costs of depreciable assets. The most common are the straight-line, declining balance, and the units of production method. Straight-line depreciation relates cost allocation to the passage of time and recognizes equal periodic charges over the life of the asset (Smith et al., 1998). The straight-line approach considers depreciation as a function of time rather than as a function of usage. Asset cost less the residual or salvage value equals the depreciable cost of the asset. Depreciable cost divided by the asset’s useful life gives the amount of periodic depreciation of the asset.

The declining balance method of depreciation provides decreasing charges by applying a constant percentage rate to a declining asset book value. The most common rate used is 2 times the rate of the straight-line depreciation or called the “200% declining balance method”. Residual or salvage value is not considered in the computation of depreciation rate, but depreciation charges should stop once the book value is equal to the residual value. To compute for the annual depreciation rate, divide the asset cost by the useful life then multiply by 200%. To get the annual depreciation charges, simply multiply the depreciation rate by the book value of the asset.

Unit of production method of depreciation is based on the theory that an asset is acquired for the service it can provide in the form of production output (Smith et al., 1998). Under this method, a depreciable rate is computed by dividing the depreciable cost of the asset by its estimated life in terms of units of production. The depreciation rate per unit multiplied by the yearly output equals the annual depreciation.

## Reference

1. Smith, J., Skousen, K.F., Stice, E., & Stice, J. (1998). Noncurrent operating asset-utilization and retirement. Intermediate accounting (pp 486-492). South Western

Calculate the price
Pages (550 words)
\$0.00
*Price with a welcome 15% discount applied.
Pro tip: If you want to save more money and pay the lowest price, you need to set a more extended deadline.
We know how difficult it is to be a student these days. That's why our prices are one of the most affordable on the market, and there are no hidden fees.

Instead, we offer bonuses, discounts, and free services to make your experience outstanding.
How it works
Receive a 100% original paper that will pass Turnitin from a top essay writing service
step 1
Fill out the order form and provide paper details. You can even attach screenshots or add additional instructions later. If something is not clear or missing, the writer will contact you for clarification.
Pro service tips
How to get the most out of your experience with MyhomeworkGeeks
One writer throughout the entire course
If you like the writer, you can hire them again. Just copy & paste their ID on the order form ("Preferred Writer's ID" field). This way, your vocabulary will be uniform, and the writer will be aware of your needs.
The same paper from different writers
You can order essay or any other work from two different writers to choose the best one or give another version to a friend. This can be done through the add-on "Same paper from another writer."
Copy of sources used by the writer
Our college essay writers work with ScienceDirect and other databases. They can send you articles or materials used in PDF or through screenshots. Just tick the "Copy of sources" field on the order form.
Testimonials
See why 20k+ students have chosen us as their sole writing assistance provider
Check out the latest reviews and opinions submitted by real customers worldwide and make an informed decision.
History
Don't really see any of sources I provided, but elsewise its great, thank you!
Customer 452697, May 8th, 2021
Human Resources Management (HRM)
excellent
Customer 452773, June 25th, 2023
excellent job! got an A, thank you
Customer 452773, May 24th, 2023
Nursing
Impressive writing
Customer 452547, February 6th, 2021
Thanks
Customer 452773, March 3rd, 2023
very good
Customer 452773, March 26th, 2023
excellent job
Customer 452773, August 26th, 2023
Social Work and Human Services
Great work I would love to continue working with this writer thought out the 11 week course.
Customer 452667, May 30th, 2021
excellent job
Customer 452773, July 28th, 2023
DATA565
The support team was late responding , my paper was late because the support team didn't respond in a timely manner. The writer of the paper finally got it right but seems there was a problem getting the revisioin to me.
Customer 452773, April 7th, 2024
Perfect
Customer 452773, February 23rd, 2023
fin571
EXCELLEN T
Customer 452773, March 21st, 2024
11,595
Customer reviews in total
96%
Current satisfaction rate
3 pages
Average paper length
37%
Customers referred by a friend
Use a coupon FIRST15 and enjoy expert help with any task at the most affordable price.
Claim my 15% OFF Order in Chat