supplement i fixed asset and depreciation methods 固定资产和折旧方法
TRANSCRIPT
![Page 1: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/1.jpg)
Supplement I
Fixed asset and Depreciation Methods
固定资产和折旧方法
![Page 2: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/2.jpg)
Classification of Assets
Current Assets( 流动资产 ) are assets which can be converted into Cash or consumed within one year or the
normal Operating cycle of the business
Current Assets( 流动资产 ) are assets which can be converted into Cash or consumed within one year or the
normal Operating cycle of the business
Fixed Assets ( 固定资产 )or long-term assets ,refer to those relatively long-lived assets which are held by a
business for use in its operation
Fixed Assets ( 固定资产 )or long-term assets ,refer to those relatively long-lived assets which are held by a
business for use in its operation
![Page 3: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/3.jpg)
L an d , b u ild in g s ,eq u ip m en t,
fu rn itu re , fixtu res .
L on g -te rmasse ts h avin g
p h ys ica l su b s tan ce .
Tangible PlantAssets
P aten ts , cop yrig h ts ,trad em arks ,
fran ch ises , g ood w ill.
N on cu rren t asse tsw ith n o p h ys ica l
su b s tan ce .
IntangibleAssets
O il reserves ,t im b er, o th er
m in era ls .
S ites acq u ired fo rextrac tin g va lu ab le
resou rces .
NaturalResources
Major Categories of Fixed Assets
Major Categories of Fixed Assets
![Page 4: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/4.jpg)
Depreciation Method of Plant Asset
Straight-line method
直线法Sum- of-the- years’-digits method
年数总和法Double-declining-balance Method
双倍余额递减法
![Page 5: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/5.jpg)
Book Value帐面净值 Cost - Accumulated Depreciation Accumulated Depreciation累计折旧 Represents the portion of an asset’s cost that has already been allocated
to expense.
Book value of last year =salvage value
Book Value帐面净值 Cost - Accumulated Depreciation Accumulated Depreciation累计折旧 Represents the portion of an asset’s cost that has already been allocated
to expense.
Book value of last year =salvage value
DepreciationDepreciation
![Page 6: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/6.jpg)
Sum-of-the-Years’-Digits Method
Sum-of-the-Years’-Digits Method
Depreciation in the early years of an asset’s estimated useful life is higher than in later years.
Depreciation in the early years of an asset’s estimated useful life is higher than in later years.
the years in reverse order The sum of number of years
the years in reverse order The sum of number of years
![Page 7: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/7.jpg)
Sum-of-the-Year-DigitsExample
Sum-of-the-Year-DigitsExample
On January 1, 2005, Bass Co. buys a new boat. Bass Co. pays $24,000 for the boat. The boat has an
estimated residual value of $3,000 and an estimated useful life of 5 years.
Compute depreciation for 2005 using the Sum-of-Years-Digits method.
On January 1, 2005, Bass Co. buys a new boat. Bass Co. pays $24,000 for the boat. The boat has an
estimated residual value of $3,000 and an estimated useful life of 5 years.
Compute depreciation for 2005 using the Sum-of-Years-Digits method.
![Page 8: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/8.jpg)
On January 1, 2005, Bass Co. buys a new boat. Bass Co. pays $24,000 for the boat. The boat has an
estimated residual value of $3,000 and an estimated useful life of 5 years.
Compute depreciation for 2005 using the Sum-of-the-Year-Digits method.
On January 1, 2005, Bass Co. buys a new boat. Bass Co. pays $24,000 for the boat. The boat has an
estimated residual value of $3,000 and an estimated useful life of 5 years.
Compute depreciation for 2005 using the Sum-of-the-Year-Digits method.
Sum-of-the-Year-DigitsExample
Sum-of-the-Year-DigitsExample
2005 Dep expense=( Cost - Residual Value )*Dep Rate of 2005=(24000-3000)*5/15=7000
![Page 9: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/9.jpg)
Sum-of-the-Year-DigitsExample
Sum-of-the-Year-DigitsExample
Compute depreciation for the rest of the boat’s estimated useful life.
Compute depreciation for the rest of the boat’s estimated useful life.
![Page 10: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/10.jpg)
Sum-of-the-Years-Digits BalanceGraph of Depreciation Expense
Sum-of-the-Years-Digits BalanceGraph of Depreciation Expense
![Page 11: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/11.jpg)
Accelerated Method
• Example on textbook ,p78
![Page 12: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/12.jpg)
Depreciation in the early years of an asset’s estimated useful life is higher than in later years.
Depreciation in the early years of an asset’s estimated useful life is higher than in later years.
The double-declining balance accelerated depreciation rate is 200% of the straight-
line depreciation rate of 1/Useful Life.
The double-declining balance accelerated depreciation rate is 200% of the straight-
line depreciation rate of 1/Useful Life.
Double-Declining BalanceExample
Double-Declining BalanceExample
![Page 13: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/13.jpg)
Depreciation in the early years of an asset’s estimated useful life is higher than in later years.
Depreciation in the early years of an asset’s estimated useful life is higher than in later years.
The book value at the beginning of the year The book value at the beginning of the year
Double-Declining BalanceExample
Double-Declining BalanceExample
![Page 14: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/14.jpg)
Double-Declining BalanceExample
Double-Declining BalanceExample
On January 1, 2005, Bass Co. buys a new boat. Bass Co. pays $24,000 for the boat. The boat has an
estimated residual value of $3,000 and an estimated useful life of 5 years.
Compute depreciation for 2005 using the double-declining balance method.
On January 1, 2005, Bass Co. buys a new boat. Bass Co. pays $24,000 for the boat. The boat has an
estimated residual value of $3,000 and an estimated useful life of 5 years.
Compute depreciation for 2005 using the double-declining balance method.
![Page 15: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/15.jpg)
Double-Declining BalanceExample
Double-Declining BalanceExample
On January 1, 2005, Bass Co. buys a new boat. Bass Co. pays $24,000 for the boat. The boat has an
estimated residual value of $3,000 and an estimated useful life of 5 years.
Compute depreciation for 2005 using the double-declining balance method.
On January 1, 2005, Bass Co. buys a new boat. Bass Co. pays $24,000 for the boat. The boat has an
estimated residual value of $3,000 and an estimated useful life of 5 years.
Compute depreciation for 2005 using the double-declining balance method.
![Page 16: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/16.jpg)
Double-Declining BalanceExample
Double-Declining BalanceExample
Compute depreciation for the rest of the boat’s estimated useful life.
Compute depreciation for the rest of the boat’s estimated useful life.
![Page 17: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/17.jpg)
Double-Declining BalanceExample
Double-Declining BalanceExample
Compute depreciation for the rest of the boat’s estimated useful life.
Compute depreciation for the rest of the boat’s estimated useful life.
![Page 18: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/18.jpg)
Double-Declining BalanceExample
Double-Declining BalanceExample
Compute depreciation for the rest of the boat’s estimated useful life.
Compute depreciation for the rest of the boat’s estimated useful life.
![Page 19: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/19.jpg)
Double-Declining BalanceExample
Double-Declining BalanceExample
Total depreciation over the estimated useful life of an asset is the same using either the straight-line method or
the declining-balance method.
Total depreciation over the estimated useful life of an asset is the same using either the straight-line method or
the declining-balance method.
![Page 20: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/20.jpg)
Double-Declining BalanceGraph of Depreciation ExpenseDouble-Declining Balance
Graph of Depreciation Expense
![Page 21: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/21.jpg)
Accelerated Method
• Example on textbook,p79
![Page 22: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/22.jpg)
Double-Declining BalanceExample
Double-Declining BalanceExample
Compute depreciation for the equipment. Compute depreciation for the equipment.
![Page 23: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/23.jpg)
Double-Declining BalanceExample
Double-Declining BalanceExample
Compute depreciation for the equipment. Compute depreciation for the equipment.
![Page 24: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/24.jpg)
Exercise
• Jon Seceda furnace Corp. purchased machinery for $ 50,000 at the beginning of the year 1.It is estimated that it will have a useful life of 5 years , residual value of $5000.compute the depreciation under the each of the following method (round to two decimal places)
• Sum-of-years’-digits• Double-declining balance
![Page 25: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/25.jpg)
Sum-of-the-Year-DigitsExample
Sum-of-the-Year-DigitsExample
![Page 26: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/26.jpg)
Double-Declining BalanceExample
Double-Declining BalanceExample
![Page 27: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/27.jpg)
Exercise
• Jon SECEDA furnace corp. purchased machinery for $315,000 on April 1,2004. It is estimated that it will have a useful life of 10 years , scrap value of $ 15000
• From the information given , compute the depreciation charge in 2004 under each of the following method( round to three decimal places)
• straight-line • sum-of-years’-digits• Double-decline balance
![Page 28: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/28.jpg)
Exercise
• [(315000-15000) ×1/10] ×9/12=22500
• [(315000-15000)×10/55]×9/12=40909.09
• [(315000×2/10] ×9/12=47250
![Page 29: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/29.jpg)
Book Value帐面净值 Market Value/ fair Value
市场价值 / 公允价值 the price which the assets are
exchanged in the market
Book Value =Market Value
Book Value帐面净值 Market Value/ fair Value
市场价值 / 公允价值 the price which the assets are
exchanged in the market
Book Value =Market Value
DepreciationDepreciation
![Page 30: Supplement I Fixed asset and Depreciation Methods 固定资产和折旧方法](https://reader030.vdocuments.mx/reader030/viewer/2022012308/56649cdf5503460f949a8dcf/html5/thumbnails/30.jpg)
assignment
Problems 2 ( p 81)
Problems 1 ( p 80)