Question

difference between accelerated depreciation and straight-line method

Answer 1

1.accelerated depreciation model, assets depreciate at a faster rate during the beginning of their lifetime and slow down near the end of the asset’s life.accelerated depreciation shows less profit in the early years of asset acquisition.The common method of accelerated depreciation is called the double declining balance (DDB) method. This is where the depreciation expense doubles the straight line depreciation expense of the first year. The same percentage is then applied to the non depreciated amount in the subsequent years.

2.straight-line depreciation method utilizes equal annual amounts of depreciation of the asset. The straight line depreciation method takes the purchase or acquisition price, subtracts the salvage value and then divides it by the total estimated life in years.