ACCAF3知识点：Depreciation

ACCA F3知识点：Depreciation
今天给大家说一说ACCA F繁口识点，关于depreciation方面，即折旧。

Depreciation represents the systematic allocation of the depreciable amount (cost less residual value at the end of its useful life) of a fixed asset over its estimated useful life. Depreciation is consistent with the matching concept — the original cost of the non -current asset is spread across the accounting periods that are expected to benefit from its use.
Depreciation has dual effects. Firstly, depreciation is charged as an expense in the statement of comprehensive income; secondly, the corresponding credit is accumulated in the provision for depreciation account in the statement of financial position to offset against the original cost of the non -current assets.
The journal entry is:
Dr Depreciation (SOCI) XX
Cr Provision for depreciation (SOFP) XX
这里有两种折旧的方式，即straight-line method 和reducing balance method.
Straight-line method (直线法) is spread evenly across the useful life of the non -current asset, resulting in same amount of depreciation charged every year.
Straight line 计算方式:(Cost-Residual value)/useful life
Reducing balance method (余额递减法):A fixed depreciation rate (say 20% p.a.) is applied to the non -current asset' s net book value(cost less accumulated depreciation) every year. Since net book value diminishes yearly, the depreciation charge falls every year.
Reducing balance method: X% x Net Book Value (NBV)
Note: the residual value does not impact reducing balance calculation of depreciation.
Policy is to charge depreciation at 20% per year on the straight line basis, with proportionate depreciation in the year of purchase and disposal (or ignore depreciation in the year of disposal or charge the full year in the year of acquisition).。