How to write a preface about the depreciation method of fixed assets

Fixed assets are the basic elements engaged in production and business activities, and their physical form will gradually wear out in the process of use, and eventually be scrapped due to wear to a certain extent or because of technological progress and other reasons. However, the value form (or monetary form) of fixed assets will gradually be transferred to the cost with the process of production and operation, and will be compensated through a certain form of value. Only in this way can social reproduction be sustained.

Compensation for the value of fixed assets is usually made in the form of depreciation. Because fixed assets are tangible assets with a certain unit value and useful life, their physical form can play a role in a relatively long period of time, and accordingly, their value form can also be compensated for this relatively long period. Or in layman's terms, the investment cost of fixed assets is compensated by recovering it year by year, and this way of recovery is depreciation.

The depreciation of fixed assets is to ensure that the fixed assets are renewed in physical form within a certain period of time; Compensated in the form of value (money). The cost of depreciation of fixed assets is ultimately compensated in the process of production and business activities through the income obtained from the sale of products (commercial) and labor services.

According to Marx's theory of social reproduction, any producer or operator must maintain simple reproduction in order to achieve expanded reproduction.

Hello, happy with your question.

In the process of production and operation, the enterprise uses fixed assets and causes the loss of their value to reduce only a certain residual value, and the difference between the original value and the residual value is apportioned over its useful life, which is the depreciation of fixed assets. Determining the depreciation range of a fixed asset is a prerequisite for accruing depreciation. [1]

A monetary estimate of the value of the capital expended during the period examined. Also known as capital consumption allowance in the national income account. Depreciation of fixed assets refers to the systematic apportionment of the accrued depreciation amount according to the determined method during the useful life of the fixed assets.

Useful life refers to the expected life of a fixed asset, or the quantity of goods or services that the fixed asset can produce. Accrued depreciation refers to the amount of the original price of a fixed asset for which depreciation is accrued after deducting its estimated net residual value. For fixed assets for which provision for impairment has been made, the cumulative amount of provision for impairment of fixed assets shall also be deducted.

Summary. Hello dear, I'm honored to answer for you <>

What is the significance of the depreciation method of fixed assets? As follows: with the development of the economy and the continuous expansion of the scale of enterprises, the investment in fixed assets of enterprises has gradually increased, how to reasonably and scientifically estimate the value of fixed assets and the accounting of depreciation, not only related to the true reflection of the economic benefits of enterprises, but also affect the management of follow-up investment of enterprises.

What is the significance of the depreciation method of fixed assets?

Hello dear, I'm honored to answer for you <>

What is the significance of the depreciation method of fixed assets? As follows: with the development of the economy and the continuous expansion of the scale of enterprises, the investment in fixed assets of enterprises has gradually increased, how to reasonably and scientifically estimate the value of fixed assets and the accounting of depreciation, not only related to the true reflection of the economic benefits of enterprises, but also affect the management of follow-up investment of enterprises.

I hope to help you with the following related extensions: Fixed assets refer to non-monetary assets held by enterprises for the production of products, provision of labor services, leasing or operation and management, which have been used for more than 12 months and have a value of a certain standard, including houses, buildings, machines, machinery, means of transportation and other equipment, appliances and tools related to production and business activities. Fixed assets are the means of labor of an enterprise, and they are also the main assets on which an enterprise relies for production and operation.

From the perspective of accounting, fixed assets are generally divided into production fixed assets, non-production fixed assets, leased fixed assets, unused fixed assets, unused fixed assets, financial lease fixed assets, and donated fixed assets.

Still have questions? Kiss, can you talk about it specifically? Or is there anything you'd like to talk about? <>

Hello dear <>

Conclusion of the depreciation method of fixed assetsDetailed explanation of the depreciation method of fixed assets? The enterprise shall accrue the depreciation of fixed assets on a monthly basis, and the depreciation of fixed assets increased in the current month shall not be depreciated in the current month, and the depreciation shall be accrued from the next month; Depreciation of fixed assets reduced in the current month will be continued in the current month, and depreciation will be stopped from the next month. After the depreciation is fully applied, no depreciation will be withdrawn regardless of whether it can be continued to be used; Depreciation will not be made for fixed assets that are scrapped in advance.

There are four main types of fixed asset depreciation methods, each with its advantages and disadvantages, let's take a look! 1. Straight-line depreciation method, (1) the average life method, the average life method refers to a method that evenly apportion the accrued depreciation of fixed assets to the intended useful life of fixed assets. The amount of depreciation calculated in this method is equal for each period.

The calculation formula is as follows: annual depreciation rate = (1 - estimated net residual value rate) estimated service life of the buried lease (years) * 100% monthly depreciation rate = annual depreciation rate December depreciation liquid amount = original price of fixed assets * monthly depreciation rate (2) Workload methodThe workload method is a method to calculate the depreciation amount payable in each period based on the actual workload. The calculation formula is as follows:

Depreciation per unit of effort = Original price of fixed asset * 1 - Estimated net residual value rate) Estimated total effort Monthly depreciation of a fixed asset = Monthly workload of the fixed asset * Depreciation per unit of effort.

2. Accelerated depreciation method (1) The sum of years method is also known as the total years method, which refers to a method of calculating the annual depreciation amount by taking the original price of fixed assets minus the estimated net residual value by multiplying a fraction of the remaining useful life of fixed assets at the beginning of each year as the numerator and the sum of the annual figures of the expected service life as the denominator. The calculation formula is as follows: annual depreciation rate = still useful life Sum of years of estimated service life * 100% Sum of years of expected service life = n * (n + 1) Depreciation rate in February = annual depreciation rate Depreciation amount in December = (original price of fixed assets - estimated net residual value) * monthly depreciation rate (2) Double declining balance method The double declining balance method refers to the balance after deducting accumulated depreciation from the original price of fixed assets at the beginning of each period (i.e., net fixed assets) without considering the estimated net residual value of fixed assets and double the straight-line depreciation rate is a method of calculating the depreciation of fixed assets.

The calculation formula is as follows: annual depreciation rate = 2 Expected useful life (years) * 100% monthly depreciation rate = annual depreciation rate Depreciation amount in December = net fixed assets * monthly depreciation rate Since the net value of fixed assets at the beginning of each year does not deduct the estimated net residual value, therefore, when applying this method to calculate the depreciation amount, it must be noted that the net value of fixed assets cannot be reduced below its expected net residual value, that is, the depreciation of fixed assets using the double declining balance method is usually within two years before the expiration of its depreciation period. The balance of net fixed assets after deducting the estimated net residual value is apportioned equally.

A brief description of the method of depreciation of fixed assets is as follows:

The depreciation methods of fixed assets include the average life method, the workload method, the double declining balance method, and the sum of years method.

1. Life average method: also known as the straight-line method, refers to a method that evenly apportion the accrued depreciation of fixed assets to the expected useful life of fixed assets. The amount of depreciation calculated in this method is equal for each period.

2. Workload method: refers to the method of calculating the depreciation amount in units of the workload that can be provided by fixed assets. The workload can be the total mileage of the car, or the total workbench shift, total working hours of machinery and equipment, etc.

3. Double declining balance method: It refers to a method of accelerating depreciation by multiplying the opening net book value of fixed assets by a fixed percentage without considering the estimated residual value of fixed assets.

4. Sum of years method: It refers to a method of accelerating depreciation by multiplying the net amount of the original value of fixed assets minus the estimated residual value by a decreasing fraction (called the depreciation rate).

Time frame for depreciation of fixed assets:

When the enterprise actually accrues the depreciation of fixed assets, the depreciation of the fixed assets increased in the current month is not mentioned in the current month, and the depreciation is accrued from the next month. The depreciation of fixed assets reduced in the current month shall be provided for in the current month, and the depreciation shall not be provided from the next month. After the fixed assets are fully depreciated, no depreciation will be accrued regardless of whether they can continue to be used.

Depreciation will not be made for fixed assets that are scrapped in advance.

For fixed assets that have reached the intended state of use but have not yet completed the final accounts, the cost shall be determined according to the estimated value and depreciation shall be provided; After the final accounts are completed, the original provisional value will be adjusted according to the actual cost, but the depreciation amount that has been accrued is not required.

Fixed assets that are out of use in the process of modernization and transformation shall be transferred to the carrying amount of the construction in progress and depreciation shall not be accrued. After the renovation project reaches the predetermined usable state and is converted into a fixed asset, depreciation shall be accrued according to the redetermined depreciation method and the remaining useful life of the fixed asset.

The depreciation methods of fixed assets are the average age method (also known as the straight-line method), the workload method, the double declining balance method, the sum of years method, etc.

The average method is to evenly allocate the accrued depreciation of fixed assets to the expected useful life of fixed assets, and the depreciation amount calculated by this method is equal for each period.

Calculation formula: annual depreciation rate = (1 - estimated net residual value rate) estimated useful life (years).

Monthly depreciation rate = annual depreciation rate in December.

Depreciation amount = original price of fixed assets Monthly depreciation rate.

Or: Annual depreciation amount = (original price of fixed assets - estimated net residual value) Estimated useful life (years) = Original price of fixed assets (1 - Estimated net residual value rate) Estimated useful life (years).

Monthly depreciation = annual depreciation 12

The workload method refers to a method of calculating the amount of depreciation payable for each period based on the actual workload.

Calculation formula: Depreciation per unit of effort = [Original value of fixed assets (1 - Estimated net residual value rate)] Estimated total effort.

Monthly depreciation of a fixed asset = Monthly workload (actual) of the fixed asset Depreciation per unit of work.

The double declining balance method is a method of calculating the depreciation of fixed assets based on the net book value of fixed assets (the book balance of fixed assets minus accumulated depreciation) and the double straight-line depreciation rate at the beginning of each period without considering the residual value of fixed assets.

The depreciation of fixed assets is calculated using the double declining balance method, and the balance of the net book value of the fixed assets after deducting the estimated net residual value should be amortized on an average basis within two years before the expiration of the useful life of the fixed assets.

Calculation formula. Annual depreciation rate = 2 100% of the estimated useful life

Monthly depreciation rate = annual depreciation rate of 12

Monthly depreciation amount = net book value of fixed assets at the beginning of each month Monthly depreciation rate.

Hello, for your question [depreciation method with fixed depreciation rate], the answer to this question is as follows. Hello, 1. The average life method is also known as the straight-line method, which is the most common depreciation method in accounting and taxation, and the calculation is relatively simple, the value of fixed assets will change according to the passage of time, and the amount of depreciation in each period is fixed, and the use of your fixed assets does not matter. It is calculated as follows:

1 - Estimated Net Residual Value Rate) Estimated useful life * 100% = Annual depreciation rate. 2. The depreciation method of the old workload method is mainly used for transportation enterprises, or for construction equipment with large value but not often used. Depreciation is calculated based on the amount of work, and the greater the workload, the greater the depreciation amount, and the depreciation amount will change with the change in workload.

The drawback of this calculation method is also obvious, because it ignores the intangible loss, which can occur even if the fixed asset is not in use. There are relevant provisions in the tax law that fixed assets will be depreciated every month, so Hongpei blindness has caused a certain difference. The calculation is as follows:

Original value of fixed assets * (1 - estimated net residual value rate) Estimated total workload of machinery and equipment = depreciation per unit of workload. The monthly workload of the fixed asset * the depreciation amount of the unit workload of machinery and equipment = the monthly depreciation amount of a fixed asset. 3. The double declining balance method is a method of accelerated depreciation, which is suitable for some enterprises that occupy an important position in the national economy, such as pharmaceutical production enterprises, automobile manufacturing enterprises, electronic production enterprises, chemical production enterprises, shipbuilding industry enterprises and some special industries approved by other financial departments.

The calculation method is,2 Estimated useful life of machinery and equipment = annual depreciation rate. 4. The total number of years is also a method of calculating accelerated depreciation, which needs to meet certain conditions, and is also applicable to enterprises that occupy an important position in the national economy, and the same enterprises that apply to the double balance method, which need to be reported to the tax bureau for approval, and enterprises can use the sum of years method to calculate depreciation. The calculation method is that the acceptable service life of machinery and equipment The sum of the estimated service life of the machinery * 100% = the depreciation rate of the sum of the years.