Straight-line depreciation

Straight-line depreciation

DQ 2 in 200 words

A variety of depreciation methods are used to allocate the cost of an asset to all of the accounting periods benefited by the use of the asset.  Your client has just purchased a piece of equipment for $100,000.   Explain the concept of depreciation.  Which of the following depreciation methods would you recommend: straight-line depreciation, double declining balance method, or an alternative method? 

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Every asset is liable to depreciation as it ages i.e. it becomes less valuable as monetary value decreases. There are several methods that depreciation is calculated from for example, straight-line depreciation, double declining balance method, or percentage depreciation. An asset has specific period of depreciation. For example an asset worth $100, 000 may depreciate at the rate of 10 %, at the end of one year; the item must be able to cater for debiting $10, 000. I can recommend straight line depreciation method which is calculated by spreading an asset value over the period of depreciation. In this case we………….

APA

222 Words