depreciated over the useful life of the asset

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Ruzanna

Senior Member
Russian
Hello,

I don't understand this sentence:

Leased assets are depreciated over the useful life of the asset.

What does it mean? Do they cost less than the useful life of the asset? Or what? I can't understand anything.
 
  • JustKate

    Senior Member
    Can you tell us where you found this, Ruzanna? Depreciated has several possible meanings, and which one is intended depends on the context in which it is being used. For example, how I, just speaking as a regular person, typically use depreciated is different than how my insurance agent typically uses the term. This sounds more like something my insurance agent would say, but if you tell us where you found it, we can be more definite.
     

    Ruzanna

    Senior Member
    Russian
    Can you tell us where you found this, Ruzanna? Depreciated has several possible meanings, and which one is intended depends on the context in which it is being used. For example, how I, just speaking as a regular person, typically use depreciated is different than how my insurance agent typically uses the term. This sounds more like something my insurance agent would say, but if you tell us where you found it, we can be more definite.
    It is a document and it says about amortization of assets and things like that. Its a financial document.
     

    e2efour

    Senior Member
    UK English
    It's a standard phrase in accounting.
    What is means is that the value of an asset is reduced each year in the books (i.e. on the balance sheet).

    The usual method of doing this is to subtract a fixed amount from the asset each time (the straight-line method of depreciation), which is arrived at by dividing the value by the useful (economic) life measured in years.
     
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