Income Statement Flashcards
1
Q
STRAIGHT-LINE DEPRECIATION
A
expected life
2
Q
REDUCING BALANCE DEPRECIATION
A
Percentage reduction
3
Q
NET BOOK VALUE
A
What is the asset worth after depreciation
4
Q
PREPAYMENTS
A
Is when an expense is made in advance (rent, delivery) (already paid)
5
Q
ACCRUALS
A
Is when an expensive is paid after the periods
(pay after) (electricity, bills)
current liabilities (debts)
6
Q
TRICKS
A
1) Depreciation amount (so the % calculation) is always an EXPENSE
2)
