Depreciation – the process of gradual transfer of the value of fixed assets as their physical and moral wear and tear on the product produced with their help and the use of the form with this special money – depreciation deductions for the simple and expanded reproduction of fixed assets.
At the same time land plots and objects of nature management, as well as other objects of fixed assets, consumer properties which do not change with time, are not subject to depreciation. Depreciation allows for long-term remission of capital previously invested in fixed assets of the organization, using one of the following methods: linear; diminishing balance; write-down of value by the sum of the number of years of useful life; write-down of value in proportion to the volume of products (works).
Under the linear method, the annual amount of depreciation charges is determined based on the original cost or current (replacement) cost (in the case of revaluation) of the fixed asset, and the depreciation rate is calculated based on the useful life of this object; under the diminishing balance method – based on the net book value of fixed assets at the beginning of the reporting year and the depreciation rate calculated based on the useful life of this object and the acceleration factor established in the tax code of the Russian Federation.
at the method of writing off the cost by the sum of the number of years of useful life – based on the original cost or current (replacement) cost (in the case of revaluation) of a fixed asset and the ratio, the numerator of which – the number of years remaining until the end of the useful life of the object, and in the denominator – the sum of the number of years of the useful life of the object; at the method of writing off the cost in proportion to the volume of production (work) – based on the natural indicator of production (work) volume in the reporting period and