Depreciation of fixed assets allows you to repay the value of the objects related to the number of fixed assets.
no secret that the main means of wear during operation of the enterprise, reduces their cost.Over time, each enterprise is necessary to replace the funds available to the new, improved, or hold their reconstruction or modernization.In this context, one might even say that the depreciation and amortization of fixed assets linked.After all, the latter allows the company to reimburse the money spent on the purchase of the necessary resources, plant and equipment when incurred first.You could even say that the depreciation of fixed assets - a specially developed method to include parts of the value of these funds in the most cost that inevitably arise in the manufacturing process of a product.Then, these resources will be spent on compensation for resource consumption.
Depreciation of fixed assets may be assessed in different ways:
· linear during the application of which the amount of depreciation determined in accordance with the historical cost, which, if necessary, replaced by a restored and depreciation rates established useful life.It calculates the annual values;
· declining balance method, which allows to calculate the amount of depreciation for the year, depending on what the residual value at the moment and the useful life of the object, as well as on the basis of fixed rate now;
· means the sum of annual figures.In this case, the annual amount generated by depreciation determined according to the initial cost of the object, which, if necessary, replaced by a restored and coefficients, calculated by the remaining term and all the useful object;
· proportion to the volume of products produced at the company.In this case a natural indicator of the volume of manufactured products during the reporting period and the coefficient defined as the quotient of the initial value of the property and the indicative amount of product that can make a company for the time of useful objects belonging to the fixed assets of enterprises ;.
The useful life used in the above calculations, each company or organization can install yourself, depending on what will be:
· the expected useful life of the object to be agreed with the expected productivity or capacity;
· physical wear and tear, which depends on the intended mode of operation;
· period of use, established by regulations and other documents, for example, the lease agreement.
This parameter can be revised after the changes in the major parameters or characteristics of the object, if it is carried out its reconstruction and modernization made.
It is worth to note that the Tax Code establishes a list of objects for which depreciation of fixed assets is not calculated.These include objects do not change their properties and parameters over time.
Depreciation of fixed assets is always calculated after the adoption of the object on the accounting records from the first day of the month that follows after that.The end of these charges will be the month following the date on which the payment is made in full value of the property or it will be written off from the accounting.
