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+--- Thread: amortization and depreciation question (/thread-amortization-and-depreciation-question)
amortization and depreciation question - snyk8122 - 03-27-2010
Hello, All!
I am new to this forum but have begun some accounting fun so I very well may become a regular
I have a question regarding amortization and depreciation.
If you know a company's non-current asset balances (plant and equipment net $59,000, and Patent net $28,000) and that no long-term assets were purchased or sold during the year reported on the balance sheet, how would one figure out how much amortization and depreciation expense the company recoded during that year?
I would guess it's 3,000, 7,000, or 4,000 but I'm not sure.
Thanks for any help that you can provide.
- Qureshi Muhammad Zeeshan - 03-27-2010
well dear, According to my knowledge u can not calculate Depreciation without complete information.
u have just given the balance of Assets nothing else
so it is not possible
infact, u can calculate Depreciation or amortization if both Opening and closing balance of Assets are given.
dep would be the amount of difference b/w opening and closing balance if there were no purchase and Disposal.
- Qureshi Muhammad Zeeshan - 03-27-2010
similarly u can calculate depreciation if the assets was used only 1 year.so u can calculate the depreciation by taking the percentage of depreciation.. for this purpose, divide the depreciation amount of the previous year in which the asset was used with the total cost of Asset, u get the percentage and then u can easily calculate the depreciation of this year.
- Qureshi Muhammad Zeeshan - 03-27-2010
if these answers does not provide u the sufficient solution then kindly give some more information about your problem
- snyk8122 - 03-27-2010
Hi Q,
Thank you so much for the fast response. What you said below makes sense. I didn't realize that one would need further information to correctly answer the question.