A Complete Guide to Journal or Accounting Entry for Depreciation
The amount of depreciation charged on various assets is considered a business expense. Depreciation expense is recorded to allocate costs to the periods in which an asset is used. Each fixed asset unit should have a separate Accumulated Depreciation account. In our example, we have two espresso machines, but the depreciation of each machine is presented in only one account. Another important aspect of depreciation is that it is an estimate based on the historical cost of the asset (not...