Some assets have expiration dates in their usability

Understanding Methods for Calculating Depreciation Expense

Depreciation is the allocation of the cost of a fixed asset over an extended period of time. This conforms to the matching principle of accounting where the periodic adjusting entries to record depreciation expense are made to correspond with the revenues — the use of that asset helped to create during a specific accounting period. Three common methods used in calculating depreciation expense are straight-line units-of-production double-declining balance If all of …