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If an asset is expected to produce a benefit in future periods, some of these costs must be deferred rather than treated as a current expense. This expense is recognized by businesses for financial reporting and tax purposes.
The asset is referred dimitrov djokovic sharapova dating as a depreciable asset.
The business then records depreciation expense in its financial reporting as the current period's allocation of such costs. Depreciation is technically a method of allocation, not valuation, even though it determines the value placed on the asset in the balance sheet.
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Generally the cost is allocated, as depreciation expense, among the periods in which the asset is expected to be used. The former affects the balance sheet of a business or entity, and the latter affects the net income that they report. Depreciation is any method of allocating such net cost to those periods in which the organization is expected to benefit from use of the asset.
One such cost is the cost of assets used but not immediately consumed in the activity. These may be specified by law or accounting standards, which may vary by country. Generally this involves four criteria: For example, a depreciation expense of per year for five years may be recognized for an asset costing