Thursday, July 02, 2020
03:06 PM (GMT +5)

Go Back   CSS Forums > CSS Optional subjects > Group I > Accounting & Auditing

Reply Share Thread: Submit Thread to Facebook Facebook     Submit Thread to Twitter Twitter     Submit Thread to Google+ Google+    
 
LinkBack Thread Tools Search this Thread
  #1  
Old Saturday, February 23, 2008
pakfame's Avatar
Member
 
Join Date: Feb 2008
Location: Lahore
Posts: 82
Thanks: 0
Thanked 42 Times in 25 Posts
pakfame is on a distinguished road
Default Depreciation Difference

Why is depreciation on the income statement different from the depreciation on the balance sheet?

Depreciation on the income statement is the amount of depreciation expense that is appropriate for the period of time indicated in the heading of the income statement. The depreciation reported on the balance sheet is the accumulated or the cumulative total amount of depreciation that has been reported as expense on the income statement from the time the assets were acquired until the date of the balance sheet.

Let’s illustrate the difference with an example. A company has only one depreciable asset that was acquired three years ago at a cost of $120,000. The asset is expected to have a useful life of 10 years and no salvage value. The company uses straight-line depreciation on its monthly financial statements. In the asset’s 36th month of service, the monthly income statement will report depreciation expense of $1,000. On the balance sheet dated as of the last day of the 36th month, accumulated depreciation will be reported as $36,000. In the 37th month, the income statement will report $1,000 of depreciation expense. At the end of the 37th month, the balance sheet will report accumulated depreciation of $37,000.

Last edited by Princess Royal; Monday, September 07, 2009 at 01:43 AM.
Reply With Quote
Reply

Thread Tools Search this Thread
Search this Thread:

Advanced Search

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are On
Pingbacks are On
Refbacks are On


Similar Threads
Thread Thread Starter Forum Replies Last Post
Difference between http & https. PHARM Computers and Technology 0 Tuesday, February 24, 2009 10:50 PM
Discuss the primary difference between selling and marketing concept? obaid Economics 1 Wednesday, February 06, 2008 10:26 PM
make a difference ashi Computers and Technology 1 Tuesday, May 23, 2006 06:44 PM
for sis Dania ...Difference b/w research methods and research design Somayya Sociology 0 Saturday, March 04, 2006 03:20 PM


CSS Forum on Facebook Follow CSS Forum on Twitter

Disclaimer: All messages made available as part of this discussion group (including any bulletin boards and chat rooms) and any opinions, advice, statements or other information contained in any messages posted or transmitted by any third party are the responsibility of the author of that message and not of CSSForum.com.pk (unless CSSForum.com.pk is specifically identified as the author of the message). The fact that a particular message is posted on or transmitted using this web site does not mean that CSSForum has endorsed that message in any way or verified the accuracy, completeness or usefulness of any message. We encourage visitors to the forum to report any objectionable message in site feedback. This forum is not monitored 24/7.

Sponsors: ArgusVision   vBulletin, Copyright ©2000 - 2020, Jelsoft Enterprises Ltd.