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Home > Resources > Depreciation Questions
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Questions on Depreciation
Below are answers to common depreciation questions. For more information visit www.DepreciationGuru.com to see our knowledge base on depreciation and fixed assets. You can read detailed posts on the features of Bassets eDepreciation, the latest industry news and post questions for our experts.
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| What is depreciation? |
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Depreciation is a deduction
for capital expenditure. |
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Depreciation is a reasonable allowance
for the wear and tear of assets used in a trade or
business or for the production of income. |
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Depreciation decreases the company's
balance sheet assets and is also recorded as an operating
expense for each period. |
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Various methods of depreciation
are used which alter the number of periods over which
the cost is allocated and the amount expensed each
period. |
Webinar - Managing the Life Cycle of Corporate Assets
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| What
property is eligible for depreciation? |
| Property can be depreciated
if it meets all these conditions: |
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Used for business or held for production
of income |
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Has a useful life exceeding one
year |
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Wears out or loses value over time |
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Paper – A Guide to Basic Depreciation Calculation
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What
is not eligible for depreciation? |
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Property that has one
year or less expected useful life. This property
can be deducted as current expenses in the year it
is purchased. |
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Property disposed in the same year
it is purchased. |
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working demo of Bassets Fixed Asset Software
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When
does depreciation end? |
| Either the tax year
that the asset is fully depreciated (based on depreciation
method & convention) or the year the property is
retired from service through sale, exchange or destruction. |
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What
are the depreciation parameters? |
| In order to
calculate depreciation, there are 4 required elements: |
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Cost of the asset |
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Date that the asset was placed in service |
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Depreciation method and first year
convention |
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Recovery period that is based on
the type of asset |
See
the features of an automated fixed asset system
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GASB
34 compliant |
| The GASB Statement 34
establishes new financial reporting requirements for
state and local governments throughout the United States.
The major accounting changes related to capital assets
are infrastructure reporting and depreciation accounting. |
For
more information on GASB Statement 34 – click
here
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How
can Bassets help? |
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Less than 50 assets – access our online depreciation calculator here, Depre123. This is a web application that will calculate monthly depreciation for the entire life of an asset. |
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Less than 1,000 assets – Bassets eDepreciation Compact Edition is an excellent entry level fixed assets
system. |
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More than 1,000 assets – Larger installations can use the WorkGroup (up to 10,000 assets), Standard (up to 100,000 assets) or the unlimited assets in the Enterprise edition to handle asset management and depreciation in a highly scalable application. |
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With a simple click of the mouse
you can access the formatting tools that will allow
you to customize Bassets to suit the specific needs
of your industry and company. It is this simple adaptability,
combined with ease of use, that has won us clients
in every industry.
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Our new Bassets Depre123 is a full featured, web-based depreciation application is a great option for organizations looking to track and depreciate their assets without having to maintain local software. Gain access toDepre123 anywhere that you have internet access.
Download a Product Overview of Depre123
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