Buy custom Discuss the importance of depreciation.
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Business
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| Number of pages / Number of words: |
3 / 800 |
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Thus, if a machine cost 1 million 100 thousand drachmas and is assumed to have a 10 year useful life and a scrap value of 100 thousand drachmas at the end of 10 years, the amount of annual depreciation would be 100 thousand drachmas and the annual depreciation rate 10 per cent. Which is the annual depreciation divided by cost minus scrap value...
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Which is the annual depreciation divided by cost minus scrap value.
Because depreciation is subtracted from the assets of a financial statement it is not a subject to taxation therefore the company has automatically achieved a higher cash flow status by depreciating its assets, the worth of its capital value...
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