Ch 3 · Depreciation Accounting

📘 Core concepts

1. 1Depreciation: systematic allocation of depreciable amount of an asset over its useful life.
2. 2Causes: wear and tear, obsolescence, efflux of time, accidents.
3. 3Methods: Straight Line Method (SLM) and Written Down Value (WDV).
4. 4AS-10 (PPE): depreciation reviewed at each year-end; useful life and residual value re-estimated.
5. 5Change in method is a change in accounting estimate (prospective effect).