Accelerated Depreciation


DEFINITION of 'Accelerated Depreciation'

Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years of the life of an asset.

BREAKING DOWN 'Accelerated Depreciation'

The straight-line depreciation method spreads the cost evenly over the life of an asset. On the other hand, a method of accelerated depreciation like the double declining balance (DDB) allows you to deduct far more in the first years after purchase.

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  1. What would cause a decrease in accumulated depreciation?

    When a company's accumulated depreciation decreases, it is normally due to the sale of a long-term fixed asset or group of ... Read Full Answer >>
  2. What are the different ways to calculate depreciation?

    In the United States, accountants have to follow generally accepted accounting principles (GAAP) to calculate and report ... Read Full Answer >>
  3. What is the best method of calculating depreciation for tax reporting purposes?

    Depreciation offers businesses a way to recover the cost of an eligible asset by writing off the expense over the course ... Read Full Answer >>
  4. Can working capital be depreciated?

    Working capital as current assets cannot be depreciated the way long-term, fixed assets are. In accounting, depreciation ... Read Full Answer >>
  5. Do working capital funds expire?

    While working capital funds do not expire, the working capital figure does change over time. This is because it is calculated ... Read Full Answer >>
  6. How much working capital does a small business need?

    The amount of working capital a small business needs to run smoothly depends largely on the type of business, its operating ... Read Full Answer >>

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