--%>
Assignment Help - homework help

Why depreciation is not charged on land

Explain why depreciation is not charged on land?

E

Expert

Verified

The land doesn’t get depreciated. The cause being that the depreciation is assumed to be the reduction in the value of an asset since of:

i) Usage, 
ii) Extraction, 
iii) Obsolescence and so on.

Either the capital asset is employed and can no more give as much level of output or a few asset from which minerals, coal and so on are extracted are getting exhausted or a few technology and so on are getting obsolete therefore they are depreciated.

The land is not subject to either of the stuff. The market value of the land might go down since of seasonal reasons, however land can’t get depreciated.

   Related Questions in Financial Accounting

  • Q : Cash flows from operating activities A

    A financial analysis tools that measures the need for financing. The formula is the cash-flow from operating activities divided by the cash paid for long-term asset. Cash paid for long-term assets can be found on the statement of cash-flow, in the investing-activities

    		•
  • Q : Development phases of Friendship There

    There are six developmental phases of how friendships develop. Identify each phase in sequence and discuss the characteristics of each phase by using real or hypothetical example to illustrate this developmental path.

    		•
  • Q : Characteristics of international and

    Explain characteristics of the international and the domestic banks.

    		•
  • Q : Case study of a local public utility

    The local public utilities commission has been charged with inspecting and reporting utility problems in the area. They have three electrical inspectors and two gas inspectors, each available for 40 hours , to analyze structures in their respective areas of expertise.

    		•
  • Q : What is Purchase What is Purchase .

    What is Purchase. Briefly state the definition of it?

    		•
  • Q : Double taxation Specify some of the

    Specify some of the methods taxing authorities utilize to remove or diminish evil of double taxation?

    		•
  • Q : Elder Abuse Explain the term Elder

    Explain the term Elder Abuse in brief ?

    		•
  • Q : Policy issued by upper management What

    What would you do when upper management issues a new policy and it was problematic to you? Would you pursue the new policy?

    		•
  • Q : Highlights of Lobbying Define the term

    Define the term Lobbying in the the act of attempting to persuade affiliates of a legislative body to cast their vote in favor of the lobbyist.

    		•
  • Q : Balance Sheets & Income Statement

    Bio-Pure Food Company Gary Green has recently inherited some money and is interested in investing in a small company with some growth potential.  Last week he r

    		•