Information about financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit.
Main Page: business, stock trading, financial, finance, inventory, accounting, money, financial advisor,
Definition of Sum-of-the-years'-digits depreciation
Method of accelerated depreciation.
Any depreciation method that produces larger deductions for depreciation in the
(1) The estimated useful life of the fixed asset being depreciated is
Any of several methods that recognize an increased amount
A contra-fixed asset account representing the portion of the cost of a fixed asset that has been previously charged to expense. Each fixed asset account will have its own associated accumulated depreciation account.
A contra, or offset, account that is coupled
The sum total of all deprecation expense recognized to date
Ratio of consumption to disposable income. See also marginal propensity to consume.
Credit granted by a firm to consumers for the purchase of goods or services. Also called
A federal Act specifying the proportion of
The CPI, as it is called, measures the prices of consumer goods and services and is a
An index calculated by tracking the cost of a typical bundle of consumer goods and services over time. It is commonly used to measure inflation.
The relationship between consumption demand and disposable income. More generally, it refers to the relationship between consumption demand and all factors that affect this demand.
A non-cash expense that provides a source of free cash flow. Amount allocated during the
A technique by which a company recovers the high cost of its plant-and-equipment assets gradually during the number of years they’ll be used in the business. depreciation can be physical, technological, or both.
An expense that spreads the cost of an asset over its useful life.
Refers to the generally accepted accounting principle of allocating
Reduction in value of fixed or tangible assets over some period
Both the decline in value of an asset over time, as well as the gradual
a) Of capital stock: decline in the value of capital due to its wearing out or becoming obsolete.
The systematic and rational allocation of the cost of property, plant, and equipment
Amortization of fixed assets, such as plant and equipment, so as to allocate the cost over their depreciable life.
Tax deductions that businesses can claim when they spend money on investment goods.
An expense account that represents the portion of the cost of an asset that is being charged to expense during the current period.
Depreciation tax shield
The value of the tax write-off on depreciation of plant and equipment.
depreciation tax shield
Reduction in taxes attributable to the depreciation allowance.
Method of accelerated depreciation.
Earnings before interest, taxes, depreciation and amortization (EBITDA)
The operating profit before deducting interest, tax, depreciation and amortization.
Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
An earningsbased measure that, for many, serves as a surrogate for cash flow. Actually consists of working
EBDDT - Earnings before depreciation and deferred taxes
This measure is used principally by
Economic environment in which the firm expects to reside over the life of the
Homogenous expectations assumption
An assumption of Markowitz portfolio construction that investors
Marginal Propensity to Consume
Fraction of an increase in disposable income that is spent on consumption.
an assumption made about the rates of return that will be earned by intermediate cash flows from a capital project; NPV and PI assume reinvestment at the discount rate; IRR assumes reinvestment at the IRR
Straight line depreciation
An equal dollar amount of depreciation in each accounting period.
A depreciation method that depreciates an asset the same amount for each year of its estimated
This depreciation method allocates a uniform
Constant depreciation for each year of the asset’s accounting life.
An accelerated depreciation method that makes the sum of the digits in an asset’s expected
Summarized bill of materials
A bill of materials format showing the grand total
tax benefit (of depreciation)
the amount of depreciation deductible for tax purposes multiplied by the tax rate;
tax shield (of depreciation)
the amount of depreciation deductible
A type of game wherein one player can gain only at the expense of another player.
Related to : financial, finance, business, accounting, payroll, inventory, investment, money, inventory control, stock trading, financial advisor, tax advisor, credit.