04-10-2010, 06:20 PM
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by Qureshi Muhammad Zeeshan</i>
<br />Dear members
i have a Question Regarding Depreciation
Depreciation can be Calculated by Dividing the Cost of Asset with its life.
my Question is that whether this life is Economic life or the useful life.
well i have Studied IAS-16 and the word useful life is written over there but i m confused that suppose if there is a machine whose Economic life is 10 but it is useful for me for just 3 years.
now whether i have to calculate dep on the basis of Economic life(10) or Useful life(3 years)
infact, i have an opinion that it should be calculated on the basis on 3 year but a friend of mine Argued that is must be calculated on the basis of its Economic life.
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
but if useful life is given it means its straight line method...isnt it..n in diminishing balance method...we have rate of depreciation n book value of asset..not original cost
<br />Dear members
i have a Question Regarding Depreciation
Depreciation can be Calculated by Dividing the Cost of Asset with its life.
my Question is that whether this life is Economic life or the useful life.
well i have Studied IAS-16 and the word useful life is written over there but i m confused that suppose if there is a machine whose Economic life is 10 but it is useful for me for just 3 years.
now whether i have to calculate dep on the basis of Economic life(10) or Useful life(3 years)
infact, i have an opinion that it should be calculated on the basis on 3 year but a friend of mine Argued that is must be calculated on the basis of its Economic life.
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">
but if useful life is given it means its straight line method...isnt it..n in diminishing balance method...we have rate of depreciation n book value of asset..not original cost
