Topic 5

Calculation of depreciation

Depreciation and accumulated depreciation of fixed assets (tangible assets) mustbe determined except for land.

The formula used in the calculation is as follows:

For example: A machine priced 30,000 baht is expected to have 10 years of useful life and then it can be sold for 2,500 baht. The depreciation can be determined as follows:

Or calculated as a percentage (%) of cost equally each year

From a similar example, depreciation is calculated at the rate of 10%. Therefore,