Depreciation-Meaning-Explanation-Journal Entry for Depreciation

Depreciation is Decrease in value of an Tangible Asset for certain reasons like Wear and Tear, old Technology, misuse, Obsolescence etc. It is a non cash expense. The asset should be replaced once the end of their useful life is reached. There are several methods to find depreciation like Straight line method, Written down Value method, Annuity method etc.

Journal Entry For Depreciation:

1.       Depreciation a/c                             Dr                              XXX
            To Asset a/c                                                                            XXX

2.      P & L a/c                                 Dr                             XXX
            To Depreciation a/c                                                             XXX