Term
| a depreciation method that allows for larger amounts of depreciation in early years and smaller amounts in later years; the double declining-balance method is an example |
|
Definition
| accelerated method of depreciation |
|
|
Term
| the total depreciation from the start of the life of a plant asset to any point in time |
|
Definition
|
|
Term
| a capital expenditure that literally adds on to an existing plant asset; the cost of an addition is debited to a plant asset account |
|
Definition
|
|
Term
| the periodic write-off of the cost of an intangible asset |
|
Definition
|
|
Term
| a capital expenditure that improves a plant asset, such as placing siding on a building; the cost of a betterment is debited to a plant asset account |
|
Definition
|
|
Term
| in an exchange of plant assets, the difference between the price of the new asset and the trade-in allowance granted for the old asset |
|
Definition
|
|
Term
| an expenditure for a plant asset that benefits more than one accounting period; examples include additions, betterments, and extraordinary repairs; capital expenditures increase either the value or the life of the asset and are debited to either a plant asset account or its Accumulated Depreciation account, depending on the type of expenditure |
|
Definition
|
|
Term
| the expense resulting from the using up of a natural resource |
|
Definition
|
|
Term
| the expense that results from the allocation process of depreciation |
|
Definition
|
|
Term
| a table that lists for a plant asset the amount of depreciation for each year and the accumulated depreciation and book value of that plant asset at the end of each year |
|
Definition
|
|
Term
| a depreciation method that allows greater depreciation in the early years of the life of a plant asset and less depreciation in later years; achieved by applying a constant rate to each year's decreasing book value |
|
Definition
| double declining-balance method |
|
|
Term
| the amount of time that an asset is expected to be in use or the amount of output it is expected to produce |
|
Definition
| estimated useful life (EUL) |
|
|
Term
| a capital expenditure that prolongs the life of a plant asset, such as new wiring in a building; the cost of an extraordinary repair is debited to the Accumulated Depreciation account |
|
Definition
|
|
Term
| a long-term asset used in a business that lacks physical substance; examples include patents, copyrights, trademarks, and franchises |
|
Definition
|
|
Term
| an asset account to which the cost of improvements to real estate, such as sidewalks, driveways, fences, and parking lots (all of which have a limited life), are debited |
|
Definition
| Land Improvements account |
|
|
Term
| a long-term asset that is acquired to extract or remove resources from the ground; examples include oil wells, coal mines, and forests; also referred to as a wasting assets |
|
Definition
|
|
Term
| an expenditure for a plant asset that benefits only the current accounting period; examples include repairs and maintenance expenses; debited to an expense account |
|
Definition
|
|
Term
| the amount that an asset is expected to be worth at the end of its productive life; also referred to as scrap value, trade-in value, and residual value |
|
Definition
|
|
Term
| the annual percent of depreciation in the straight-line method; calculated by dividing 100% by the estimated years of life |
|
Definition
|
|
Term
| a depreciation method in which cost is allocated over the estimated productive life of a plant asset, and life is expressed by such measures as hours, units, or miles |
|
Definition
| units-of-production method |
|
|
