Recent Articles

Accelerated Depreciation

Customarily found in tax depreciation, it allows the small business owner the oppotunity to take more depreciation expense and reduce their respective tax obligation for that calendar year.

Bookkeeping – Book and Tax Depreciation (Lesson 52)

03/19/2017

One of the differences between book income and taxable income is depreciation.  In general Section 168 of the Internal Revenue Code allows businesses to accelerate their depreciation for tax purposes.  This increases the expenses of the business [...]

Bookkeeping – Introduction to Depreciation (Lesson 50)

03/12/2017

Depreciation is the process of allocating the initial capital outlay for fixed asset purchases over time to the income statement.   The basic principle is that any fixed asset has a predetermined lifetime based on time, usage or fair market value. [...]

Various Sets of Accounting Books

12/27/2014

Accounting’s primary purpose is to measure economic activity.  There are several different methods to determine the economic value generated in your business each year.  In accounting this is referred to as sets of books.  There are four basic [...]

Accelerated Depreciation – An Explanation

12/17/2013

When it comes to depreciation, no two businesses are alike. Unlike traditional straight line depreciation where the asset value is cost out to depreciation expense in equal increments over a given life expectancy, accelerated depreciation expenses [...]

The Various Forms of Depreciation

02/22/2013

There are various forms of depreciation used in the small business world.  In general, depreciation is not required but it is advisable.  So a small business owner should understand depreciation and the various forms of how to calculate the [...]

What is Amortization?

01/15/2013

There are three methods of expensing an asset to the income statement.  The most common method is depreciation for fixed assets.  Mining, oil, and natural resource operations use depletion (amount removed versus the estimated volume on hand).  [...]

The Definition of Fixed Assets

01/05/2013

Any tangible item not consumed within one accounting cycle (typically a year) and providing long term utility is referred to as a Fixed Asset.  Traditional images include manufacturing equipment, tools, transportation vehicles, buildings and [...]

Small Business Tax Depreciation – Section 179

12/23/2012

The Internal Revenue Service sets the depreciation allowance based on the Code as promulgated by Congress.  The most commonly referenced section is 179.  This is a form of accelerated depreciation allowing the small business owner the opportunity [...]

Depreciation – This is Weird Accounting

12/11/2012

In the world of accounting, there are two types of expenses on the reports widely misunderstood.  They are depreciation and amortization.  I will try to help the novice gain an understanding of depreciation in this article.  So if you can, clear [...]

Local Revenue Tax – The Business License

12/04/2012

A business license is the tool used by local governments to monitor all businesses in their community.  It triggers at least two types of tax.  At a minimum a revenue and personal property tax is charged through this registration process. [...]