Accumulated Depreciation is the total amount of depreciation expense that has been recorded for an asset to date. It represents the wear and tear or reduction in value of the asset over its useful life.
Book value represents the carrying amount of an asset as recorded on the company's balance sheet. It is generally the purchase price of the asset plus any capital improvements minus accumulated depreciation.
Depreciable basis refers to the portion of an asset’s cost that can be depreciated over its useful life for tax purposes. It is an essential concept in the calculation of depreciation expenses, influencing both financial reporting and tax liabilities.
Fair value is a measure used for the estimation of the market value of assets and liabilities based on orderly transactions between market participants. This valuation concept is essential in accounting to maintain proper financial statements and balance sheets according to standard principles.
Intangible value refers to the worth of an asset that cannot be physically seen or touched, such as brand reputation, intellectual property, and goodwill.
Market price is the actual price paid in a market transaction for an asset, in contrast to the market value. It reflects the monetary amount a buyer is willing to pay and a seller is willing to accept under normal market conditions.
Remaining economic life refers to the likely future period during which an asset is expected to generate a positive contribution to its value. It measures how long an asset will continue to be economically useful, considering various factors like wear, functional obsolescence, and market conditions.
Sum-of-Years’-Digits (SYD) is an accelerated depreciation method that segments the depreciation of an asset by applying larger deductions at the beginning of the asset's useful life and smaller deductions towards the end.
Tax Basis, also known as Basis (Tax), refers to the original value of a property or asset for tax purposes, with potential adjustments over time reflecting improvements, depreciation, or other factors.
An unrealized gain refers to the increase in the market value of an asset that remains unsold, reflecting a rise in value relative to its purchase cost. It remains 'unrealized' until the asset is sold.
A wasting asset is a property, resource, or investment that diminishes in value over time due to inherent factors like physical deterioration, depletion, or obsolescence.
A write-down is an accounting term that describes the reduction in the book value of an asset when its fair market value falls below its carrying value on the balance sheet. This is often recorded to reflect a decrease in the asset's value due to obsolescence, damage, or market conditions.
