Accumulated depreciation
In accounting, accumulated depreciation means the contra-asset holding every dollar of a fixed asset's cost already charged to depreciation — credited each period, presented beneath the asset's cost, and removed with the asset when it is sold or scrapped.
Authority: ASC 360-10 (opens in a new tab). Sources
The lessons that teach this
From the free founder back-office course, taught on one company's books, with exercises to work it yourself.
- AccountingAccounts, and the five typesEvery account is one of five types, and the type decides which side increases it. Get the type right and the entry follows.9 min
- AccountingFixed assets and depreciation › Selling a fixed assetThe van sold years from now: cost and accumulated depreciation leave together, and the difference from the price is a gain or a loss.4 min
Accumulated depreciation, in use
Quoted from the 5 documents that use the word: what it does to an interface, in the spec's own words.
Cost, in-service date (not purchase date, labeled explicitly), life, method, convention, accumulated depreciation, NBV.
Showing Accumulated depreciation 218,400 as a positive asset is a classic mistake, and every reviewer spots it.
Sold after 26 months for $25,000: accumulated depreciation is 19,500, NBV is 28,500, and the disposal posts Dr Cash 25,000 / Dr Accumulated depreciation 19,500 / Dr Loss on disposal 3,500 / Cr Equipment 48,000.
Schedules, accruals & roll-forwards — 5. Fixed assets & depreciation
For founders
The same idea written for a founder: what it costs a startup that ignores it, and what to do in a real month.
- Audit-ready books before your Series AInvestors, lenders and auditors ask for the same things: accrual statements, reconciled accounts and support for every balance. How to be ready first.
- General ledger and double-entry bookkeeping, explainedHow double entry works: journal entries, debits and credits, normal balances, running balances, the trial balance, and why posted entries are reversed.
- Chart of accounts for startups: a starting templateA starting chart of accounts for a US startup: number ranges, the expense accounts you need, and when to add an account versus a class or tracking tag.
What it is not called
Each of these means something else. Use one here and an accountant reading the product notices.
- depreciation reserve
- depreciation (the period's charge)
Components that render this
These components name it in their spec, grouped and labeled exactly as the catalog shows them.
Components that render the terms it depends on
Few components name this concept outright, but it's built from terms they do name. These render depreciation, fixed asset, period, asset.
4Swaps & FX
Family spec5Ledger & tables
Family spec- PeriodPickerFiscal-aware. Never assumes January.
- FluxAnalysisPeriod-over-period explanations.
- ProfitAndLossP&L with period comparison and variance.
- ReportHeaderEntity, statement, period, basis, currency, as-of. Every figure states its basis.
- StatementTableThe shared shell: hierarchy, periods, rules.
- StatementToolbarBasis, period, comparison, currency, consolidation.
- BalanceSheetAssets / liabilities / equity, with the balance check.
- AdjustingEntryFormTemplated by type. Auto-reverse defaults on for accruals.
- SchedulePreviewWhat the schedules will post, before they post.
- ScheduleTableOne shell, seven presets. Prepaids through debt.
- RevenueWaterfallDeferred balance recognizing by future period.
- LeaseScheduleROU asset and liability on diverging curves.
11Payables (AP)
Family spec12Close, controls & consolidation
Family specAlso in Fixed assets & leases
Defined in Lexicon. This page is generated from that document, so the two can't disagree.