--%>
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 : Money market Simply define and

    Simply define and illustrate the Money market?

    		•
  • Q : Causes of decreasing of Gross profit

    What are the various causes of decreasing of Gross profit margin?

    		•
  • Q : Fundamenetal Issues on Management

    1.  Somerset Ltd manufactures components for the motor industry. In one of its workshops it has three workers, Joe, Jack and Jonny, who at any one time work on batches of the same component. The standard time allowed to produce one unit is one hour. The workers rate of pay is

    		•
  • Q : Comprehensive Project Please help me in

    Please help me in solving this requirement

    		•
  • Q : Vernon’s product life-cycle theory of

    Discuss the Vernon’s product life-cycle theory of the FDI. Specify the strength and weakness of theory?

    		•
  • Q : Salary outstanding account What type of

    What type of Account is Salary outstanding? What do you think, it is real or personnel or the nominal account?

    		•
  • Q : Define Liabilities Liabilities mean the

    Liabilities mean the amount which the firm owes to the outsiders. Liabilities are of two types: -Long term liabilities & Short term liabilities. Examples of long term liabilities are long terms loans, bonds etc. & examples of short term liabil

    		•
  • Q : Guidelines for effective communication

    Define and explain the four guidelines for effective communication in families. Give examples to describe each guideline.

    		•
  • Q : Appropriated retained earnings The

    The portion of retained earning that is not available for dividends. To appropriate retained earnings, the company must record the partitioning of retained earnings. The company can use appropriated retained earnings for contingencies or big projects. Appropriating retained earning does not invol

    		•
  • Q : Implications of fixed and flexible

    Explain “balance of payments” identity and discuss some of its implications under the fixed and flexible exchange rate regimes.

    		•