- Trending Categories
- Data Structure
- Operating System
- MS Excel
- C Programming
- Social Studies
- Fashion Studies
- Legal Studies
- Selected Reading
- UPSC IAS Exams Notes
- Developer's Best Practices
- Questions and Answers
- Effective Resume Writing
- HR Interview Questions
- Computer Glossary
- Who is Who
Compare depreciation and amortisation.
The major differences between depreciation and amortization are as follows −
It determines asset useful life.
Charged on tangible assets.
Annual depreciation = (cost of tangible asset – salvage value)/useful life.
Have salvage value.
International accounting standard (IAS-16)/accounting standard (AS-6).
Residual value is considered.
Straight line method, reducing balance method, units of production method.
Determined on the basis of its legal or economic life.
Charged on intangible assets.
Annual amortisation = (cost of intangible asset)/useful life.
Don’t have salvage value.
International accounting standards (IAS-38)/accounting standard (AS-26).
Doesn’t considered residual value.
Straight line method.
- Related Articles
- Compare accounting depreciation and tax depreciation.
- Difference between Accumulated Depreciation and Depreciation Expense
- Difference between Tax Depreciation and Book Depreciation
- Describe the term amortisation in finance and accounting.
- Differences between Accelerated Depreciation and Straight-Line Depreciation
- Differentiate between sinking fund depreciation and annuity method of depreciation.
- Accounting Depreciation Vs Tax Depreciation
- Difference between Bonus Depreciation and Section 179
- Explain sinking fund depreciation.
- What is Accelerated Depreciation and how is it measured?
- Explain revaluation method of depreciation.
- Describe concept of composite depreciation.
- Sinking Fund Method of Depreciation
- Explain about Earnings before interest taxes depreciation and amortization (EBITDA).
- Explain insurance policy method of depreciation