This article throws light upon the top seven methods for charging depreciation on assets. The methods are: 1. Fixed Installment 2. Diminishing Balance Method 3. Annuity Method 4. Depreciation Fund Method 5. Insurance Policy Method 6. Revaluation Method 7. Depletion Method 8. Machine Hour Rate Method. Method # 1. Fixed Installment: This is the oldest and simplest method of charging [...]
The following points highlight the top four valuation concepts of assets. The concepts are: 1. Historical Cost 2. Current Entry Price (Replacement Cost) 3. Current Exit Price (Net Realisable Value) 4. Present Value of Expected Cash Flows. Valuation Concept # 1. Historical Cost: Cost has been the most common valuation concept in the traditional accounting structure. Assets are generally recorded [...]
In this article we will discuss about the combination of values approach. The combination of values approach has been suggested as a way of avoiding some of the disadvantages of the different current value valuation methods. The Canadian Accounting Research Committee (CARC) favours a combined use of current entry and current exit prices. More specifically, the following values are advocated [...]