What is depreciation?

Becoming familiar with calculating your business asset depreciation can help you better understand your business tax return. Calculating the depreciation amounts in small business accounting does require some effort, however, it is doable when you have the required figures. If this is your first time with accounting formulas, you can use the included calculator above to help you get organized.

Commonly used depreciation methods are as follows: straight line, units of production, and double declining. Each of these methods has a different formula of calculation. The straight-line method is the least involved, while units of production and double declining require more numbers and details.

Making sure your depreciation is accurate can help you get your taxes right. Ensuring the balances add up can ease preparations at tax time and give you peace of mind about your small business. Check back often for our next series post about depreciation.

Author: Trent Elijah

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