Over time, the assets a company owns lose value, which is known as depreciation. As the value of these assets declines over time, the depreciated amount is recorded as an expense on the balance sheet.

The goal of accounting is to produce fair and accurate statements about a company's financial performance and condition. An underlying principle of accounting is to connect the expenses that are ...

A company's net cash inflow is composed of sales, minus total fixed costs and total variable costs. Total fixed costs are those that do not fluctuate with output, and include annual depreciation costs ...

Accelerated depreciation allows businesses to write off the cost of an asset more quickly than the traditional straight-line ...

The net worth of a business is also known as its book value, or as its owners' (stockholders') equity. This figure can be computed relatively easily using information found on a company's balance ...

Depreciation is a fairly simple concept. When a business owner buys a fixed asset, that asset loses its value over time, and so its most current value must be accounted for on the company’s balance ...

Net worth equals assets minus liabilities; calculate using the basic accounting equation. Tangible assets include cash, real estate; intangibles include brand names, patents. Negative net worth may ...