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CHAPTER 11Depreciation, Impairments, and DepletionASSIGNMENT CLASSIFICATION TABLETopicsQuestions Brief ExercisesExercisesProblemsCases 1. Depreciation methods; meaning of depreciation; choice of depreciation
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Depreciation methods refer to the various techniques used to allocate the cost of a tangible asset over its useful life.
Business entities that own tangible assets and are required to follow accounting standards are required to file depreciation methods.
Depreciation methods can be filled out by selecting a suitable method such as straight-line, double declining balance, or units of production method and applying it to the cost of the asset.
The purpose of depreciation methods is to accurately reflect the decrease in value of a tangible asset over time and allocate this cost to the periods in which the asset is used.
Information such as the cost of the asset, useful life, salvage value, and method of depreciation used must be reported on depreciation methods.
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