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Pages:
1 pages/≈275 words
Sources:
2
Style:
APA
Subject:
Accounting, Finance, SPSS
Type:
Essay
Language:
English (U.S.)
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MS Word
Date:
Total cost:
$ 4.68
Topic:
AF-U7D
Essay Instructions:
In a recent newspaper release, the president of Magnusson Company asserted that something has to be done about depreciation. The president said, “Depreciation does not come close to accumulating the cash needed to replace the asset at the end of its useful life.” What is your response to the president?
Essay Sample Content Preview:
AF-U7D
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The calculation and allocation of certain costs in accounting are crucial in how a business eventually balances its books to realize profitability. The president of the company in this case, is quite on point. Depreciation expense doesn’t really close to the accrual of the amount needed to replace the asset (Kimmel, Weygandt & Kieso, 2020). It is just a way of rationally allocating the cost of running the asset during its useful life span. Depreciation expense in this case can be defined as the expense that comes as a result of the use of the assets owned by the company, such as the plant and machinery. For this expense to be determined, there is a need to look at the depreciation method em...
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