Desde Investopedia

TERM OF THE DAY

Double Declining Balance Depreciation Method The double declining balance depreciation method is one of two common methods a business uses to account for the expense of a long-lived asset. The double declining balance depreciation method is an accelerated depreciation method that counts twice as much of the asset’s book value each year as an expense compared to straight-line depreciation. The formula is: Depreciation for a period = 2 x straight-line depreciation percent x book value at beginning of period.

Breaking it Down: Under the generally accepted accounting principles (GAAP) for public companies, expenses are recorded in the same period as the revenue that is earned as a... Read More